Under the Triple Lock, the New and Basic State Pensions<\/a> increase each year in-line with whichever is the highest between the average annual earnings growth from May to July (published on September 16), September\u2019s Consumer Price Index (CPI) inflation rate (published mid-October), or 2.5 per cent.<\/p>\n It\u2019s important to be aware that additional elements of the State Pension, including payments<\/a> for those who have deferred claiming it, rise annually by the September CPI figure.<\/p>\n READ MORE: Older women urged to check for State Pension back payments worth around \u00a38,000<\/a>READ MORE: State Pension uprating will not be paid to nearly half a million older people<\/a><\/p>\n The latest ONS figures show average regular earnings growth is at 4.6 per cent (including bonuses) in the three months to June, while CPI is currently at 3.8 per cent.<\/p>\n If the earnings growth remains at that level, people on the New State Pension could see payments rise by over \u00a3550 next year.<\/p>\n State Pension uprating predictions for 2026\/27<\/p>\n Chancellor Rachel Reeves will confirm the State Pension and benefits uprating during the Autumn Budget on November 30, so the calculations below are estimates based on the current highest measure of the Triple Lock.<\/p>\n That being said, a 4.6 per cent increase on the current State Pension would see people receive the following amounts.<\/p>\n Full New State PensionWeekly: \u00a3240.85 (from \u00a3230.25)Four-weekly pay period: \u00a3963.40Annual amount: \u00a312,524Full Basic State PensionWeekly: \u00a3184.55 (from \u00a3176.45)Four-weekly pay period: \u00a3738.20Annual amount: \u00a39,596<\/p>\n Data analysis by financial experts at Broadstone<\/a> say that with average earnings growth including bonuses currently running at 4.6 per cent it is expected to outpace inflation. If this rate were maintained in September, the new State Pension would rise annually by \u00a3551, taking it to around \u00a312,524 a year from \u00a311,973.<\/p>\n However, if earnings growth falls dramatically, then the next determinant for an uprating will be the inflation figure.<\/p>\n If September\u2019s inflation figure matches the Bank of England\u2019s projection of 4 per cent, the State Pension would increase by around \u00a3480 from April 2026 – lifting it to \u00a312,452 per year.<\/p>\n However, such a rise could see more pensioners pulled into paying income tax as the Personal Allowance will remain frozen at \u00a312,570 until April 2028.<\/p>\n While the increase is unlikely to be enough to tip the full New State Pension over the personal tax allowance threshold, it is still likely to cause even more pensioners to be liable for income tax.<\/p>\n The latest data from HM Revenue and Customs (HMRC) shows 8.7 million people of State Pension age or older are projected to pay income tax on retirement income in 2025\/26, a rise of around 420,000 compared to the previous year (2024\/25) and a rise of 1.85m from ten years ago (2015\/16).<\/p>\n Broadstone\u2019s analysis follows the recent launch of the independent State Pension age review which will make recommendations for future arrangements in light of long-term demographic pressures and questions around the sustainability of the State Pension in its current form.<\/p>\n David Brooks, Head of Policy at Broadstone, said: “Another significant increase to the State Pension now looks inevitable given the strong growth in average earnings and rising inflation.<\/p>\n \u201cThe good news is this will provide further financial assistance to pensioners in light of ongoing cost of living pressures and the reliance of many retirees on the State Pension as their main source of income.<\/p>\n “The bad news is that the rising costs of the contributory benefit risks creating growing tension between today\u2019s taxpayers who fund the system and current pensioners who rely on it. The Government and Pensions Commission will be under pressure to confront this challenge as part of the independent State Pension age review.\u201d<\/p>\n He continued: \u201cIt seems inevitable that, while the State Pension will and should remain a bedrock of retirement provision, calls to introduce means-testing will grow louder. These should be resisted, but what remains on the table is the possibility of the cost being met by wealthier pensioners via the introduction of a National Insurance Contribution of some kind or a winding down of the Triple Lock.<\/p>\n \u201cUltimately, the cost of the State Pension is a political decision. The persistence of the Triple Lock has created a steady rise in costs without clear long-term policy direction. As the retired population grows and depends increasingly on today\u2019s workers to fund the system, some form of change is unavoidable.\u201d<\/p>\n Join the conversation on our Money Saving Scotland Facebook group<\/a> for money-saving tips, the latest State Pension and benefits news, energy bill advice and cost of living updates.<\/p>\n Sign up to our Record Money newsletter and get the top stories sent to your inbox daily from Monday to Friday with a special cost of living edition every Thursday – sign up here<\/a>.<\/p>\n You can also follow us on X (formerly Twitter) @Recordmoney_<\/a> for regular updates throughout the day or get money news alerts on your phone by joining our Daily Record Money WhatsApp community<\/a>.<\/p>\n![\"\"](\"https:\/\/www.newsbeep.com\/il\/wp-content\/uploads\/2025\/09\/0_DR-MOney.png\")
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