People on State Pension on track for payments of up to £938 each month under new Labour government

Millions of older people across the UK will see future State Pension payments protected by the Triple Lock following Labour’s win in the General Election on July 4. Under the Triple Lock policy, the New and Basic State Pensions increase each year in-line with whichever is the highest between average annual earnings growth from May to July, CPI in the year to September or 2.5 per cent.

The latest figures from the Office for National Statistics (ONS) show UK inflation fell to 2.0 per cent in May and is now forecast to remain on-target for the rest of the year, and more importantly, for the crucial Triple Lock uprating measure due in mid-October.

Annual earnings growth (including bonuses) was 5.9 per cent for the period between February and April, which means it is currently the highest measure of the Triple Lock and the leading driver for the State Pension annual uprating for 2025/26.

However, it’s important to be aware that the earnings growth figure used for the Triple Lock will be published by the ONS on August 13, but as it stands, it looks set to be the key driver.

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

State Pension uprating predictions for 2025/26

The New and Basic State Pensions increased by 8.5 per cent in April - the earnings growth measure of the Triple Lock. This means someone on the full New State Pension receives £221.20 every week, 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:

• Full New State Pension - £234.45 each week, £937.80 every 4-week pay period, £12,191.40 over the 2025/26 financial year

• Full Basic State Pension - £179.65 each week, £718.60 every 4-week pay period, £9,341.80 over the 2025/26 financial year

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 experts at Spencer Churchill predict nearly 900,000 more people will exceed the Personal Allowance threshold over the current financial year, with the further 2m expected before the freeze ends in 2028 - a timeline set by the outgoing Conservative government.

The full New State Pension is worth £11,502 over the 2024/25 financial year, which leaves just £1,068 before the personal tax threshold is exceeded, so anyone with additional income of £89 or more per month - on top of State Pension - may receive a tax bill the following year.

Someone on the full rate of the Basic State Pension will receive £8,814 this year. This leaves just £3,756 before the personal tax threshold is exceeded, equivalent to additional income totalling £313 per month.