Older state pensioners are on course to get a cash boost of £7.20 extra per week from next April under the triple lock guarantee. State Pension rates increase at the start of every new tax year on April 6 in line with the triple lock, a UK government guarantee that sets the new payment rates based on the highest out of three key measures: the consumer price index (CPI) measure of inflation (measured for September the year before), average wage growth between May and July the previous year, or 2.5%.
In the current 2026/27 tax year, both the new and basic State Pension increased in line with average wage growth, as this was the highest out of the three measures at 4.8%. Early forecasts suggest that average wage growth is likely to once again be used to set next year's State Pension rates, which could boost payments by 3.9%.
Forecast based on ONS wage growth figures
According to figures from the Office for National Statistics (ONS), average wage growth for total earnings stood at 3.9% for the period between May and July 2026, making this higher than the 2.5% minimum floor increase. While the inflation figure for September isn't due to be published until October, the ONS said CPI inflation increased to 3.1% in August, compared with 2.9% in July.
Economists are predicting that inflation will continue to rise over the coming months as the Middle East conflict pushes up the cost of living, but unless it rises above 3.9%, forecasts suggest that the 2027/28 State Pension rates will be set in line with average earnings.
Impact on basic and new State Pension
If earnings growth is confirmed at 3.9%, this would give older state pensioners on the old basic State Pension an extra £7.20 per week. It would see rates rise from £184.90 to £192.10, giving pensioners entitled to the full amount a payment boost of £374.40 per year.
Men born before April 6, 1951, and women born before April 6, 1953, receive the basic State Pension, and the amount you get depends on your National Insurance record. To get the full amount, a man born between 1945 and 1951 usually requires 30 qualifying National Insurance years, while men born before 1945 require 44 qualifying years. For women, you'll need 30 qualifying years if you were born between 1950 and 1953, or 39 qualifying years if you were born before 1950.
As for pensioners who get the new State Pension, if rates increase by 3.9% this would give claimants an extra £9.40 per week if they get the full amount, taking the weekly rate from £241.30 up to £250.70. For those entitled to the maximum payment, this would provide an annual boost of £488.80 in the 2027 to 2028 tax year.
Expert reaction and tax implications
Helen Morrissey, Head of Retirement Analysis at Hargreaves Lansdown, said: "According to the ONS, average wage growth stood at 3.9%. We may have just over a month to wait until the relevant inflation figure is published, but it currently stands at 2.9%, so unless there's a real surge it seems likely that the average wage figure will be used.
"Such an increase would put someone on the full new state pension on course to receive £250.70 a week from next April – up from the current £241.30 per week. Someone on a full basic state pension would receive £192.10 a week – up from £184.90. This will be a welcome boost to pensioner incomes but even a full state pension is only ever going to cover the basics. If you want to live well in retirement, then you will need to take your pension planning into your own hands."
As the personal tax allowance has been frozen at £12,570 since 2021, it means state pensioners will be caught within the tax net for the first time. So far, the Government has said pensioners who are wholly dependent on the new State Pension – with no private pension – or the old basic State Pension, "with no increments", will not have to pay tax. It's still unclear exactly how the policy will work, but the Government is expected to set out further details in the Budget on October 28.
Minister for Pensions Torsten Bell said: "In line with the commitment made at Budget 2025, pensioners who only just exceed the personal allowance will not have the administrative burden of paying small amounts of tax in this Parliament. The Chancellor will set out further details on how that commitment will be delivered at the Budget."
