State Pension rates increase every year and pensioners are in line for a bigger than expected boost.
Pensioners are on course for a 4.8% boost to the State Pension in 2026 (Image: Getty)
State pensioners across the UK are set to get up to £12,547 annual payments from the Department for Work and Pensions (DWP) in an announcement expected on Wednesday.
The autumn Budget will be delivered by Chancellor Rachel Reeves on November 26 which will outline tax, spending and borrowing plans for the year ahead. Among the announcements, Reeves is expected to confirm an increase to the State Pension rates for 2026 with pensioners set to receive a bigger than anticipated boost. The government increases State Pension rates every year, with the increase determined by whichever is the highest out of three factors – known as the ‘triple lock’. These are the consumer price index (CPI) measure of inflation (measured for September in the previous year), average wage growth between May and July of the previous year, or 2.5%.
From April 2026, pensioners are on course for a 4.8% boost to the State Pension, 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, the State Pension is set to rise again in line with the triple lock guarantee, which means 4.8% is expected be the figure that will be used to set the new rates.
Reeves is set to confirm this in the autumn Budget announcement on Wednesday, and with a 4.8% increase, pensioners who get the full new State Pension are in line to get up to £12,547.60 in pension payments per year from April 2026, when the new rates take effect.
Currently, the full new State Pension is worth £230.25 per week, but with an expected 4.8% rise, this will go up to £241.30 in 2026, giving pensioners a weekly payment increase of up to £11.05.
Over a full year, this amounts to a total of up to £12,547.60 in pension payments (up from £11,973), giving pensioners on the full rate an extra £574.60 annually.
You can get the new State Pension when you reach State Pension age if you’re a man born on or after April 6, 1951 or a woman born on or after April 6, 1953. The amount you receive is dependent on the number of qualifying National Insurance years you have – generally, you need about 35 years.
As for older state pensioners on the basic State Pension, rates are expected to increase from £176.45 per week to £184.90 per week from April 2026, giving pensioners a weekly payment increase of up to £8.45.
Over a full year this would amount to a total of £9,614.80 in pension payments (up from (£9.175.40), giving those on the full rate an extra £439.40 annually.
The boost to both the basic and new State Pension is on course to be higher than previously expected after a key figure used in the triple lock calculation was revised upwards. Office for National Statistics (ONS) data released on October 14 showed an upwards revision to total wage growth including bonuses for the quarter to July, up to 4.8%, from 4.7% in a previous estimate.
Meanwhile, ONS figures showed that CPI inflation for September was 3.8%, remaining at the same level as both July and August.
As total wage growth, including bonuses, for the quarter to July was 4.8%, it makes this the highest of the three figures and the one that is expected to be confirmed in the Budget for April’s State Pension increase. But the increase could 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: “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.”
