Triple lock increase for April 2027 is 3.9% (probably)

hugheskevi

Here are stats from DWP Stat-Xplore for March 2026, showing the number of people under the pre and post 2016 State Pensions, and how much weekly pension they receive.

Worth noting that over 2 million pensioners already receive over £250 per week (£13,000+ p/a) under the old State Pension. That becomes 2.5m when the number of new State Pensions over £250 p/w are added to it (just under 20% of the whole pensioner population).

harz99

https://forums.moneysavingexpert.com/discussion/comment/82142222#Comment_82142222

And those very same figures show that the vast majority at over 80% don't achieve that heady amount, which proves what? You can extrapolate all sorts of conclusions from that table depending on your particular viewpoint…

zagfles

https://forums.moneysavingexpert.com/discussion/comment/82142267#Comment_82142267

26% of old state pensioners and 9% of new state pensioners. The only new state pensioners who can get that "heady amount" are those who had accrued more under the old state pension rules.

What it clearly shows is that there's a similar median amount for both the old and the new state pensions albeit with a greater concentration around the median for the NSP, as is obvious through design (ie flat rate accrual rather than earnings related). So the idea NSP pensioners are always or usually much better off is rubbish but we get people on here all the time claiming that.

SnowMan

It is also worth saying the transition to the new state pension happened at the time SPA for females was going up and SPA for them had reached about 63. So while the average current amount of new state pension for females is more than the average amount for female old state pensioners the old state pensioners had started to receive their state pensions at an earlier age.

I tend to work on the basis of there being winners and losers under the old and new state pension schemes but that there was a fiscal neutrality going on although that's not a precise concept. You can argue the new state pension was a cost cutting measure. In the longer term the new state pension is less generous on average but there was an initial cost in offering the better of the old and new bases for those reaching SPA just after vs just before 2016. That's not to say that those who reached SPA just after 2016 couldn't lose out (vs the pre 2016 position) for example because of the loss of increases on the pre 88 GMP.

The national audit office gave one indication of what this fiscal neutrality (or not) was in this publication.

OLD SYSTEM: 'Costs of state pension and pensioner benefits forecast to rise from 6.3% of GDP in 2015-16 to 8.1% of GDP in 2060. The number of people claiming state pension due to increase from 13.3 million in 2015-16 to 19.4 million in 2060-61'

NEW SYSTEM: By 2060, expenditure on state pension and pensioner benefits is forecast to be 7.6% of GDP. From 2040, most people will get less state pension than they would have under the previous system, with 76% of new pensioners in 2060 getting on average £15 a week less. From 2016-17, government will also raise an additional £2 billion each year because all employers and employees will pay the full rate of national insurance

The NAO also set out various reasons why people gain or lose from the rule changes in that linked publication.

From memory Lord Turner in the Turner Commission report in 2005 had stated that changing state pension in the way that subsequently happened in 2016 as being too complicated and would create a messy system of winners and losers. While that 2015 report was an excellent one that did take pensions policy thinking forward, I think Turner was proved wrong in relation to state pension, but others might disagree. I see the new state pension as a rare good change, made for the right reasons, while treating people fairly. Past accrual was very roughly protected subject to some caveats, but winners and losers overall were necessary to make it work, and it did work.

michaels

As a loser who had enough s2p credits at mid forties in 2016 to get the full new state pension and thus gained no further pension for any NI I paid after that point I have to say I think it was a con. I have of course minimised my ni and retired as early as possible because working became much less lucrative on a total renumeration basis. Economics 101, you make the return from working lower and people will work less and tax take will fall.

zagfles

https://forums.moneysavingexpert.com/discussion/comment/82142668#Comment_82142668

You're assuming people are intelligent enough to understand whether they're a winner or loser. I've lost count of the number of numpties coming on here complaining they've lost out when they haven't taken any account of their contracted out pension paid for by NI rebates.

Whereas hardly any have complained that, like you, their ability to accrue further state pension has been stopped because their SERPS/S2P puts them over the NSP, but someone who's been contracted out all their working life with an equivalent amount in GMP gets to accrue more state pension, and at a much faster rate than would have been the case under S2P.

Silvertabby

I've seen posts (on other boards) from people who think they are winners - because they needed less than 35 years of NI to rack up the full new single tier rate. These will be in a similar situation to michaels, but just can't see it.

The transitional arrangements are complicated, and are deemed to be as fair as possible, with more winners than losers. But as a big winner (maximum possible contracted out service 1978 to 2016 but enough time between 2016 and SPA to be able to accrue the full single tier rate) I do wonder if more could have been done to soften the blow for michaels and others like him.

And the many complaints from the (contracted out) numpties who think they have lost out set my teeth on edge as well. I have a friend in a similar situation to me - RAF pension, retired before SPA, who reckoned she had been robbed because her State pension wasn't the full amount. As I had also retired before SPA I needed to pay 4 years of voluntary Class 3 NI to take me up to the full rate, so I explained the figures to her - in round figures, 5 years ago, I paid £3K which gave me another £20 per week fully index linked State pension. Cue scoffs of '£3K for £20 isn't worth it'. When I further explained that £20 a week was £1K a year, so she would get her outlay back after less than 4 years, the scoff changed to 'I've paid enough in taxes and NI, and I'm not paying another penny if I don't have to. She is still claiming that it is 'unfair' that I'm getting the full pension, while hers is 'reduced'.

MarzipanCrumble

I am in old SP era. I have worked mostly for public sector and have consolidated DB pensions with DC one. I have benefited from:

1. Widow's accruement from deceased husband's pension - who knew?
2. Deferring at 10% for seveal years because wasn't prepared to give up work and wanted to ensure had enough income especially as husband had died prior to my retirement (9 years difference in ages).

However I wonder how many women gained SERPS in the old SP scenario? I suspect women are the losers.

molerat

I suspect women are the losers.

And why do you think that ? Some women are losers if they retired under the old rules and some are losers if they retired under the new, conversely some women are winners under the old scheme and some under the new. Under new rules you would not have received any of your husband's entitlement (there are some exceptions but that is the general rule). Low earners and carers also received enhanced S2P. The new pension / old pension argument is not black and white, it is mainly grey !

michaels

https://forums.moneysavingexpert.com/discussion/comment/82142751#Comment_82142751

Exactly this. Only pension advice I ever had was don't contract out take the safe serps option...turned out to be terrible advice!