Labour's Triple Lock policy to boost State Pension up to £938 monthly for UK pensioners

Millions of State Pensioners will receive an annual uprating through the Triple Lock for the next five years.
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Following the General Election victory of Labour on July 4, millions of older UK residents can look forward to their future State Pension payments being safeguarded by the Triple Lock. This could potentially see them receive up to £938 per month.

The Triple Lock policy ensures that both the New and Basic State Pensions increase annually in line with the highest of three measures: average annual earnings growth from May to July, CPI in the year to September, or 2.5 per cent.

The latest data from the Office for National Statistics (ONS) shows that UK inflation fell to 2.0 per cent in May and is expected to remain on target for the rest of the year. This is a key factor for the Triple Lock uprating measure due in mid-October.

Including bonuses, annual earnings growth was at 5.9 per cent between February and April. This makes it the highest measure of the Triple Lock and the main factor for the State Pension annual uprating for 2025/26.

However, it's important to note that the earnings growth figure used for the Triple Lock will be released by the ONS on August 13. As it currently stands, it appears set to be the key driver, reports the Mirror.

This could mean that nearly 12.7 million State Pensioners across the UK, including over 1.1 million residing in Scotland, could receive up to £234.45 each week, or £937.80 every four-week pay period in the next financial year, according to the Daily Record.

Predictions for State Pension uprating for 2025/26

The New and Basic State Pensions experienced an 8.5 per cent increase in April, following the earnings growth measure of the Triple Lock. This means that individuals on the full New State Pension now receive £221.20 weekly, or £884.80 every four-week pay period during the 2024/25 financial year.

Those on the full Basic State Pension receive £169.50 each week, or £678 every four-week pay period.

A 5.9 per cent increase on the current State Pension would see people receive:.

Remember, these calculations are based on the current ONS data. The one to watch out for is the May to July earnings growth figure which will be published on August 13.

It's also important to be aware that additional State Pension payments and deferred State Pensions rise each year under the CPI for September. The UK Government typically confirms the annual uprating during the Autumn Statement in November.

State Pension and tax

Pensioners will also be keen to see if Sir Keir Starmer unfreezes the Personal Allowance which has been frozen at £12,570 since the 2021/22 financial year.

The latest figures from HM Revenue and Customs (HMRC) show that 8.1m (64%) people in retirement currently pay tax, largely due to additional income from workplace or private pensions on top of their State Pension.

Pension specialists at Spencer Churchill predict that nearly 900,000 more individuals will exceed the Personal Allowance threshold in the current financial year. Furthermore, an additional 2 million are expected to do so before the freeze ends in 2028, as per the timeline set by the outgoing Conservative government.

The full New State Pension is pegged at £11,502 for the 2024/25 financial year, leaving a mere £1,068 before hitting the personal tax threshold. As such, anyone with an extra income of £89 or more per month - on top of their State Pension - could be looking at a tax bill the following year.

An individual who receives the full rate of the Basic State Pension will get £8,814 this year. This leaves only £3,756 before the personal tax threshold is breached, equivalent to an additional income of £313 per month.