Pensioners will receive an additional 4.1% per annum through the state pension starting in April 2025, thanks to the government’s ‘triple lock’ policy.  

The triple lock ensures that the state pension increases each April based on the highest of the following criteria:  

• The Consumer Prices Index (CPI) in September of the previous year  

• The average wage growth across the UK from May to June of the previous year  
• A minimum increase of 2.5%  

Recent employment data released in October prompted a revision of the earnings figure, boosting it from 4% to 4.1%. This figure, being the highest of the three, will be applied to the state pension in April 2025, barring any changes. The additional 0.1% increase is estimated to cost the Treasury around £100 million.  

The triple lock was introduced in 2010 by the coalition government, and Labour’s Rachel Reeves has committed to maintaining it. It was temporarily suspended in 2022/23 due to exceptional circumstances when inflation figures were distorted by the impacts of Covid-19 and furlough schemes. During that time, the earnings measure was removed to assist government finances. However, the triple lock was reinstated the following year, resulting in a remarkable 10.1% increase in the state pension.  

Despite its benefits, the triple lock has faced criticism for its financial burden on taxpayers, especially since other benefits do not receive similar protections. For instance, Universal Credit, Housing Benefit, Maternity Allowance, and Statutory Sick Pay are generally linked solely to September’s CPI figure, which is expected to yield a modest 1.7% increase for those benefits.  

If ratified, the state pension will change as follows:  

• From £221.20 to £230.30 per week for the full new flat-rate state pension (for those who reached state pension age after April 2016)  

• From £169.50 to £176.45 per week for the full old basic state pension (for those who reached state pension age before April 2016)  

Stay informed about these important changes that could significantly impact your financial future as a pensioner. Understanding how the triple lock works and its implications can help you navigate retirement planning more effectively. 

Sources: 

https://www.bbc.co.uk/news/business-53082530 

https://www.morningstar.co.uk/uk/news/AN_1728987850427977900/uk-government-faces-extra-gbp100-million-bill-for-state-pension-rise.aspx 

https://www.moneysavingexpert.com/news/2024/10/state-pension-benefits-rise-2025/ 

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