The Department for Work and Pensions (DWP) has confirmed that state pensioners will receive an extra £488 a year from 2027. In a policy paper published this week, the DWP announced the proposed new state pension rates from April 2027.
The change follows October's Budget, which confirmed the pension rate would rise by 3.9% from next year. Under the triple lock mechanism, the State Pension rises each year in line with either inflation, wages, or 2.5% – whichever is higher. The wage growth figure is 3.9%, meaning this will be the metric used to calculate April's State Pension rise.
New pension rates from April 2027
With the new rates, people on the full new state pension will receive £250.70 a week – which is £13,036.40 a year. Basic rate pension claimants will receive £192.10 a week, up from £184.90 in 2026.
The new rates mean those claiming the full state pension will exceed the personal income tax allowance of £12,750. However, the Government said pensioners with incomes at or below the value of the full new state pension will not be required to pay tax because of state pension uprating in this Parliament.
Triple lock changes planned
Prime Minister Andy Burnham has previously said that from April 2030, Labour plans to adjust the triple lock, which is used to increase state pensions each April. The state pension overhaul would help to fund a new National Care Service in England.
Under the plans, the state pension would continue to rise every year at least by CPI (Consumer Prices Index) inflation or 2.5%. The door would still be left open to it rising by more than this if needed in some years, so that the state pension holds its value relative to average worker earnings.
State pensions are already expected to equate to around 30% of average earnings by the end of the decade. Under the plans for the triple lock changes, the state pension would not fall below its level as a share of average earnings when the triple lock is adjusted.
Full rate and old state pension figures
The full rate for the new state pension is set to rise from £241.30 in 2026 to 2027 to £250.70 in 2027 to 2028. The transitional rate below full rate is set to change from 4.7991% to 3.8956%, while the protected payment is set to change from 3.80% to 3.50%.
Increments, both own and inherited, are set to change from 3.80% to 3.50%. For the old state pension, the Category A or B basic pension is set to rise from £184.90 to £192.10, while the Category B (lower) basic pension and Category C or D non-contributory pension are both set to rise from £110.75 to £115.05. The maximum additional pension (AP), own and inherited, is set to rise from £230.54 to £238.61.
