Older state pensioners who retired before April 2016 are set to receive a higher additional state pension (AP) payment from next April, following a 3.5% increase announced in the recent Budget. The rise will lift the maximum weekly AP payment from £230.54 to an estimated £238.61 from April 6, 2027, adding up to £419.64 per year on top of the basic state pension.
Who is eligible for the additional state pension?
The additional state pension is an extra payment available to those who reached state pension age before April 2016. According to Department for Work and Pensions (DWP) guidance, it applies to men born before 6 April 1951 and women born before 6 April 1953. The payment is made automatically to those eligible, unless they were contracted out through their workplace pension scheme.
The scheme, formerly known as SERPS or the State Second Pension, was closed to new claimants in 2002, but the DWP continues to pay AP to those who built up entitlements before that date. The amount varies depending on National Insurance contribution years, whether the individual contracted out, and whether they topped up their basic state pension between 12 October 2015 and 5 April 2017.
Budget confirms 3.5% uplift
The increase was confirmed by Chancellor John Healey in last week's Budget. The UK Parliament website stated: "Other state pension and benefit rates covered by my statutory review will be increased by 3.5%, in line with the increase in the consumer prices index in the year to September 2026."
This includes most working-age benefits, disability benefits, statutory payments such as sick pay and maternity pay, and the additional state pension. The pension credit savings credit maximum amount will also rise by 3.5%. The final monetary figure for AP is set to be confirmed by the DWP before April 2027.
How the payment is calculated
Consumer magazine Which? explains that before 2002, contributions to the additional state pension (then SERPS) were only possible for employed individuals. Under the state second pension scheme, which ran from 2002 to 2016, contributions could be made through National Insurance if the person was an employee earning at least £113 a week, caring for children under 12 and claiming child benefit, claiming carer's credit, or claiming certain disability-related benefits.
There is no fixed amount for the additional state pension, as the value depends on contribution years, earnings, and whether the individual contracted out. Those who retired after April 2016 cannot receive AP and rely solely on the new state pension, which for a full National Insurance record increased from £241.30 per week to just over £250 per week.
