Pensioners are set to receive a payment increase next month, providing a boost to their income.
The state pension increases every year on April 6, aligning with the start of the new tax year.
The amount of the increase is determined by the triple lock system, which ensures pensions rise by the highest of the following three factors:
- Consumer Price Index (CPI) inflation (measured in September of the previous year)
- Average wage growth (from May to July of the previous year)
- A guaranteed minimum increase of 2.5 per cet
For 2024, the basic and new state pensions will rise by 4.1 per cent, reflecting the annual increase in average weekly earnings from May to July 2024.
Changes will be made to the new and basic state pension rates, as well as additional elements.
The full rate will rise from £221.20 per week to £230.25
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Basic State Pension
Men born before April 6, 1951, and women born before April 6, 1953, who qualify for the basic State Pension, will see their payments rise from £169.50 per week to £176.45—an increase of £6.95 per week.
Over a full year, this amounts to an additional £360 for those receiving the full rate.
From April 2025, pensioners on the full basic State Pension will receive £9,175.40 annually. However, the full amount depends on an individual’s National Insurance record:
- Men born between 1945 and 1951 require 30 qualifying years of National Insurance contributions, while those born before 1945 need 44 years.
- Women born between 1950 and 1953 need 30 qualifying years, whereas those born before 1950 require 39 years.
Pensioners with fewer qualifying years will receive less than £176.45 per week.
New State Pension
Men born on or after April 6, 1951, and women born on or after April 6, 1953, qualify for the New State Pension once they reach the State Pension age, which is currently 66.
From April 2025, New State Pension payments will rise by 4.1 per cent, increasing the full rate from £221.20 per week to £230.25.
Over a full year, this amounts to an additional £470, bringing the total annual pension to £11,973 for those receiving the full rate. This is £2,797.60 more per year than the full basic State Pension.
Pension Credit
The standard minimum guarantee for Pension Credit, which provides additional financial support to low-income pensioners, will also increase by 4.1 per cent from April 6, 2025.
- The weekly rate for single pensioners will rise from £218.15 to £227.10, providing an extra £8.95 per week and a total increase of £465.40 annually.
- For couples, the weekly rate will increase from £332.95 to £364.60, adding £31.65 per week, which amounts to £1,645.80 more per year.
These increases aim to support pensioners with rising living costs and ensure greater financial stability for those on low incomes.
Additional state pension (SERPS/S2P)
The State Earnings-Related Pension Scheme (SERPS) and the State Second Pension (S2P), which provide additional payments beyond the basic or new State Pension, will increase by 1.7 per cent from April 2025, in line with inflation.
Protected Payment
Pensioners who reached State Pension age after April 2016 but had already built up additional State Pension (SERPS/S2P) beyond the flat-rate pension amount will continue to receive the difference as a protected payment.
This ensures that those who accrued higher pension entitlements under the old system receive their full entitlement on top of the standard State Pension rate.
The state pension will rise up to £230 a week
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Men and women born between October 6, 1954, and April 5, 1960, receive their State Pension at age 66.
For those born after this date, the State Pension age is gradually increasing.
Inherited State Pension
- Those who have inherited a portion of a spouse or civil partner’s State Pension since April 2016 will see their payments rise by 1.7 per cent.
- If the inherited pension dates back to before April 2016, the increase will be 4.1 per cent.
Married Women’s State Pension (Category B Pension)
- Spouses, typically women, who retired on small State Pensions before April 2016 are entitled to an uplift to 60 per cent of their partner’s basic State Pension once they reach retirement age.
- This Category B State Pension will increase by 4.1 per cent to £105.70 per week from April 2025.
Over-80s State Pension (Category D Pension)
UK residents aged 80 or over receive a Category D State Pension, which will increase by 4.1 per cent to £105.70 per week from April 2025.
If a pensioner is already receiving more than £105.70 per week, this payment does not apply as an additional benefit.
The over-80s additional payment remains frozen at 25p per week.
Pensioners who receive less than £101.55 per week in basic State Pension may have their payments topped up to this amount.
For example, someone receiving £43 per week in basic State Pension could get a £58.55 top-up, bringing their total weekly pension to £101.55.
Graduated Retirement Benefit (GRB) Increase
The Graduated Retirement Benefit (GRB), which was the predecessor to the Additional State Pension (SERPS/S2P) and ran from 1961 to 1975, will increase by 1.7 per cent from April 2025.
