State Pension to Rise by £460 Next April, ONS Data Suggest

UK £5, £10, £20, and £50 notes with £1 coins, in a file photo on Jan. 26, 2018. Dominic Lipinski/PA

The new full state pension is set to rise by £460 next April, the latest wages data suggest.

Under the government’s triple-lock commitment to uprate pensions every year, the amount paid out to pensioners is calculated by the highest of earnings growth, inflation, or 2.5 percent—whichever is the highest figure.

According to the latest data by the Office of National Statistics (ONS), the annual growth in total pay was 4 percent for the three months to July.

This is much higher than the current level of inflation, currently at 2.2 percent. The inflation rate is not expected to be higher than wage growth, making the rate of pay key to the next state pension increase under the triple lock.

The ONS wages figures imply that pensioners can see their full, flat-rate state pension go up to £11,962.60 a year from next April, a rise of £460. This applies to those who reached state pension age after April 2016.

For Britons, who reached the state pension age before that, the full old basic state pension is set to increase to £176.30 a week, a rise of £353.60 compared with now.

Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, said that while a pension increase will be welcomed by pensioners, it comes amid the announcement of cuts to winter fuel allowance.

“With so many still reeling from the recent news that their winter fuel payment might be taken away, it won’t be quite the boost many hoped for,” she said.

Changing Rules

The rules for winter fuel payment are changing, and from winter 2024/2025, households will no longer be entitled to it unless they receive Pension Credit or certain other means-tested benefits.

In the winter of 2023/2024 there were 10.8 million pensioners in 7.6 million households in England and Wales who received the winter fuel payment. According to the Department for Work and Pensions (DWP), 1.5 million individuals in 1.3 million households will receive it this winter.

Policymakers and campaigners have warned that slashing the allowance will affect the most vulnerable pensioners. Around five in six retirees living below the poverty line will miss out on help paying their winter fuel bills.

Morrissey also noted that the new annual pension is moving closer to the £12,570 personal tax allowance.

“Given that the freeze to this threshold is expected to remain in place until 2028, it raises the spectre of the full state pension alone taking pensioners over it and into the realms of paying income tax during the next few years,” she said.

Tough Decisions

Labour said last week that the “crashed” state of economy, inherited from the previous government, has led to the government’s “tough” decision to cut the winter fuel allowance.

“Labour are taking the tough decisions now to fix the foundations, so we can rebuild Britain and make every part of the country better off,” Chancellor Rachel Reeves said in an X post.

Pensioners on a lower income can access Pension Credit, which is separate from the state pension, to help with their living costs, such as housing, council tax and heating bills. The Treasury has estimated that over 800,000 pensioners are not claiming the benefit.

In August, the DWP announced a “Pension Credit awareness drive” to encourage eligible households not receiving the benefit to apply for it by Dec. 21. By doing so, more retirees can qualify for the winter fuel payment this year.

Critics of the cuts have questioned the government’s decision. The House of Lords Secondary Legislation Scrutiny Committee has said it is “unconvinced” by Labour’s reasons for the urgency of the decision and added that the policy is “being introduced at a pace that prevents appropriate scrutiny.”

PA Media contributed to this report.