State Pension payments could rise by more than £1,000 over the next five years
dailyrecord.co.ukOver the next five years, more than 12 million people over 66 could see their State Pension increase by over a £1,000 as a result of the Labour Government’s commitment to the Triple Lock.
Under the Triple Lock the New and Basic State Pensions increase each year in-line with whichever is the highest between the average annual earnings growth from May to July, the Consumer Price Index (CPI) inflation rate in the year to September, or 2.5 per cent.The latest figures from the Office for National Statistics (ONS) show average regular earnings growth is currently 4.5 per cent (including bonuses) in the three months to June, which makes it the leading driver for next April’s State Pension uprating.
However, the figure that will be considered as part of the Triple Lock won’t be published until September 10 and not officially confirmed until the Autumn Budget on October 30.An increase of 4.5 per cern would see the full New State Pension rise from £11,502 per year to £12,019 in 2025, taking it closer to the personal tax allowance threshold of £12,570.
The personal allowance is set to remain frozen until 2028, which means further upratings under the Triple Lock will see more pensioners pay tax in retirement.Of the 12.7 million people in receipt of the State Pension, some 8.1m (64%) currently pay tax in retirement, largely due to additional income from workplace or private pensions on top of their State Pension.
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