But as the UK’s State Pension system is split into two schemes – basic and new – the amount that pension payments will increase from April depends on when you retire, with older pensioners on the basic scheme paid at a lower rate.

Chancellor Rachel Reeves is expected to confirm a 4.8% boost to State Pension rates in the autumn Budget on Wendnesday, in line with average wage growth, as this has been confirmed as the highest figure out of the triple lock factors, above inflation and the 2.5% minimum floor for increases. Unless a radical change to State Pension rules are announced at short notice, 4.8% is expected be the figure that will be used to set the new rates.

With a 4.8% increase, it means that the full new State Pension will rise from £230.25 per week to £241.30 per week, giving pensioners who get the full amount up to £12,547.60 in pension payments per year.

But older pensioners on the full basic State Pension will only get £184.90 per week (up from £176.45) by comparison, which amounts to an estimated £9,614.80 annually – a whopping £2,932.80 less than younger retirees.

Men born before April 6, 1951, and women born before April 6, 1953, receive the basic State Pension, but anyone born after these dates can get the new State Pension instead, which is paid at a higher rate.

According to UK Parliament, an estimated 8.57 million pensioners were claiming the basic State Pension in the 2024/25 tax year, while only 4.38 million were new State Pension claimants. As the vast majority of pensioners get the basic State Pension, it means around 8.57 million are set to miss out on up to £ 2,932.80 annually when the new rates take effect.

But age isn’t the only factor in determining which State Pension you get, with everyone who is eligible for the basic State Pension having already reached State Pension age, but how much money you get also depends on your National Insurance record.

Of course, it should also be noted that some older pensioners also qualify for an “additional” State Pension, known as the State Earnings-Related Pension Scheme (SERPS). This scheme operated from 1978 until 2002 and was designed to give pensioners extra money on top of the basic State Pension based on earnings and how many years they contributed.

While the scheme has now been replaced by the new State Pension, people who were in SERPS before April 2002 continue to receive benefits as part of their State Pension, while those who were contracted out can access the money in a separate workplace or private pension.

According to analysis by Money Mail in 2024, some older retirees in their 80s and 90s can receive up to £20,176 annually, which is much higher than the new State Pension rate.

The expected 4.8% increase in 2026 could also mean that more pensioners will soon start paying tax on their State Pension as the rates may take them over the personal allowance threshold.

Alice Haine, personal finance analyst at Bestinvest by Evelyn Partners, the online investment platform, said: “For pensioners, the latest inflation data suggests another inflation-beating boost to the annual state pension payment is coming their way next April.”

She added: “The personal allowance has remained at £12,570 since the 2020-21 tax year, so unless the Chancellor revises this in the Budget, more retirees may find themselves paying a tax bill.

“Of course, some will already be paying tax on their retirement income, either because they deferred access to the state pension or because they also receive income from a private pension.”