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Triple lock increase for April 2027 is 3.9% (probably)
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In terms of new state pensioners it is around 58% as far as I can tell who receive at least the full rate of new state pension. This is what DWP stat-Xplore comes up with for March 2026, the most recent datapoint.
I came, I saw, I melted3 -
In terms of a pre 2016 state pensioner who just coincidentally is receiving exactly the amount of the new state pension of £241.30 per week made up of £184.90pw basic state pension and additional state pension of £56.40 per week, then it is impossible to say if they will receive a £9.40 per week state pension increase or not in 2027.
The popular myth is that they definitely won't because in 2027 the basic state pension element gets triple lock increases of 3.9% and the additional state pension gets 3.5% CPI increases.
However this overlooks the complex nature of the old state pension and its interaction with the historic ability to contract-out. This person might have had a period of contracting out that went along with periods of contracting-in. Under that this person would normally as well as their mix of triple lock and CPI increases on their £241.30 per week, also get 3.5% increases (for 2027) paid on their pre 88 contracted-out deduction (the contracted-out deduction applied for periods not surprisingly where they were contracted-out). An additional 0.5% (=3.5% - 3%) state pension increase for 2027 could also apply on the post 88 contracted-out deduction.
More generally this reflects a difference between old and new state pensioners and how state pension increases are applied and arguably this makes what happens fair between these two groups allowing for practical constraints.
Old state pensioners can (but not always) get these extra state pension increases on their contracted-out deduction on top of their mix of triple lock and CPI increases on their actual state pension amount. But new state pensioners never get these increases because if they did it would mean the old state pension system could not have been dismantled until the last post 2016 pensioner with pre 2016 contributions had died (although former public sector members can get these increases paid as part of their public sector pension scheme rather than by the state).
Old state pensioners don't get triple lock increases on their additional state pension so above £184.90 per week they get CPI increases only. But new state pensioners get triple lock increases on their up to £241.30 per week of new state pension.
I came, I saw, I melted0 -
Of course we still await what will happen about the new state pension exceeding the personal allowance. Well we would have had to but for the following manuscript being found on the 10:53 Burnham to London Paddington train service
Mr Speaker, the interaction between our tax thresholds and the state pension has caused anxiety for Britain’s retirees. Today, we act. But we do not just act for pensioners, we act for everyone. I am today aligning the personal allowance with the full new state pension. This means a tax cut for millions of working families, an end to the pensioner tax trap, and a simpler, fairer system that ensures hard work and a lifetime of contribution are always rewarded.
OK just my prediction.
I came, I saw, I melted0 -
Given it now exceeds the income tax threshold and that 3.9% less income tax is lower than 3.5%, the reality is that most pensioners will be worse off in real terms after income tax.
I think....0 -
Could be. The PM did comment that when fighting the Ashton & Makerfield bye election, he noted that a lot of people on the doorstep actually mentioned the freezing of the personal allowances as an issue for them. So….
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The 2024 Tory manifesto included the promise that the (State) pensioner's personal allowance would be increased to align with the single tier pension.
When Labour were asked if they would match that, they replied No!
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That was a promise that applied only to pensioners though, not an overall allowance increase. And "not promising to do it" isn't the same as "promising not to do it".
I think it's unlikely for cost reasons, but it you did it, you'd need to make other changes elsewhere to stop it from being of greatest benefit to the highest earners. (Putting £500 on the allowance saves a low part time earner/ pensioner on less than full new pension nothing at all, saves a standard rate taxpayer £100, a higher rate payer £200, etc ) .
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Except that the highest earners don't get any personal allowance so increasing it isn't going to help them.
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A higher allowance will also take longer to taper away. But yes, those at the very top of the income ladder will still have no allowance.
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Yes. Or to put my Daily Mail headline writer hat on for a bit "It extends the 60% tax band by an extra £x"
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