The Prime Minister has announced plans to modify the existing triple lock arrangement for the state pension to help fund a new social care plan. The triple lock currently ensures that the state pension increases each year in line with either inflation, wage increases, or 2.5%, whichever is highest.
Andy Burnham, a Labour Party leader, stated he would uphold the commitment made in Labour's 2024 manifesto to maintain the triple lock unchanged during the current Parliament. However, the Prime Minister indicated that starting in April 2030, the arrangement will change, with the state pension increasing each year by at least inflation or 2.5%. The annual link to average earnings, which currently influences the pension rise under the triple lock, will be removed and instead reflected over time.
The state pension is a payment made every four weeks by the government to individuals who have reached the qualifying age and have paid sufficient National Insurance (NI) contributions. The new flat-rate state pension for those reaching state pension age after April 2016 is £241.30 a week, or £12,547.60 a year, while the old basic state pension for those who reached state pension age before April 2016 is £184.90 a week, or £9,614.80 a year. Many recipients of the old basic state pension may also receive an additional state pension.
Generally, individuals need 35 years of qualifying contributions to receive a full state pension. Some may have gaps in their NI record due to living abroad or taking time off for caregiving. It is possible to make voluntary payments to enhance one's contribution history, but since April 2025, payments can only be made for the previous six years.
Data suggests that the state pension will increase in April 2027, with the flat-rate state pension likely rising to £250.70 a week, or £13,036.40 a year, an increase of £488. The old basic state pension is expected to rise to £192.10 a week, or £9,989.20 a year, an increase of £374.40. The government is expected to confirm these changes in the upcoming October Budget.
Under the current triple lock system, the state pension increases each April based on the highest of three measures: inflation in the previous September, the average increase in total wages from May to July of the previous year, or 2.5%. The rise in wages of 3.9% is likely to determine the April 2027 state pension increase.
The triple lock was introduced by the Conservative-Liberal Democrat coalition government in 2010 to ensure the state pension's value is not diminished by rising living costs or increasing incomes. The Labour government has previously committed to maintaining the triple lock until the end of the current Parliament. However, there has been considerable debate regarding the cost of the triple lock and its justification.
In July 2025, the government's official forecaster indicated that the cost of the triple lock guarantee was expected to be three times higher by the end of the decade than initially anticipated. The Office for Budget Responsibility (OBR) projected that the annual cost would reach £15.5 billion by 2030, with the total cost of the state pension currently at £138 billion, approximately half of the total government spending on benefits.
The Institute for Fiscal Studies (IFS) suggested in July that the triple lock should be eliminated as part of broader pension reforms. During his speech at the Labour Party conference, Burnham announced plans to end the existing triple lock by 2030, which would remove the annual link to earnings growth. He stated, "The state pension will continue to rise every year at least by prices or 2.5%, and it will hold its value relative to earnings over time so that pensioners will always share in the rising prosperity of the nation."
Burnham noted that this change would generate significant savings to support the national care service. The IFS described the proposed change as a "great improvement," indicating that state pensions would still rise but in a more sustainable manner. However, they cautioned that the reform may not generate sufficient savings to fund universal social care in the next Parliament.
The anticipated increase in April 2027 would place the flat-rate state pension above the personal allowance of £12,570, resulting in approximately £91 in income tax. The Labour government, under Chancellor Rachel Reeves, pledged that pensioners relying solely on the state pension would not need to file a tax return or be pursued for payment. Burnham reiterated that low-income pensioners would not be subject to income tax during this Parliament.
Currently, nearly 13 million individuals receive the state pension. Men and women born between 6 October 1954 and 5 April 1960 begin receiving their pension at age 66. For those born after this date, the state pension age is gradually increasing to 67 for individuals born on or after 5 April 1960, and to 68 between 2044 and 2046 for those born on or after 5 April 1977. The rise from 66 to 67 will commence in April 2026, affecting those born between 6 April and 5 May 1960, who will have to wait an additional month.
This increase is projected to save the Treasury approximately £10 billion annually by 2030. However, charities have expressed concerns that it will disproportionately impact regions with lower life expectancy and individuals with lower incomes. A government review is currently assessing whether to postpone the second phase, which would raise the state pension age to 68 between 2044 and 2046.