State Pension boost of up to £938 each month under new Labour government

Following Labour's landslide victory in the General Election last week, millions of older Brits can anticipate their future State Pension payments being safeguarded by the Triple Lock.

This could see them receive up to £938 a month. The Triple Lock policy ensures that the New and Basic State Pensions rise each year by whichever is the highest of three measures: average annual earnings growth from May to July, CPI in the year to September, or 2.5 per cent.

Recent data from the Office for National Statistics (ONS) reveals that UK inflation dropped to 2.0 per cent in May and is predicted to stay on target for the remainder of the year. This is crucial for the Triple Lock uprating measure due in mid-October.

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

However, it's crucial to note that the earnings growth figure used for the Triple Lock will be published by the ONS on August 13. As it stands, it looks set to be the key driver, the Daily Record reports. This could mean that nearly 12.7 million State Pensioners across the UK 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 saw an 8.5 per cent rise in April - the earnings growth measure of the Triple Lock. This means that someone on the full New State Pension now receives £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:

  • 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 estimate that nearly 900,000 more people will surpass the Personal Allowance threshold during the current financial year, with an additional 2m expected before the freeze concludes in 2028 - a timeline established by the outgoing Conservative government. The full New State Pension is valued at £11,502 for the 2024/25 financial year, leaving just £1,068 before reaching the personal tax threshold.

Therefore, anyone with an extra income of £89 or more per month - on top of their State Pension - could face a tax bill the following year. An individual receiving 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.

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