If you have questions about the State Pension or want to know more about how recent changes might impact it, look no further. Following on from our original guide to help you understand the State Pension, Kate Smith (Head of Pensions), gives an overview on the latest updates. This includes: 

  • A quick recap on the State Pension basics.
  • The triple lock being reinstated and its impact on increasing the State Pension amount.
  • The Consumer Price Index and possible income rises.
  • How the current State Pension age is doubling poverty rates.
  • The State Pension age being reviewed by the government.
  • How more State Pensioners on low incomes should claim pension credit. 

1. The State Pension basics

For many, the State Pension continues to be a main source of income in retirement. However, most people are likely to have a combination of savings, assets and investments too. This could include workplace and private pensions, saving accounts – individual (ISA) or lifetime (LISA), property and other investments. At February 2022, 12.5 million people were receiving the State Pension, of which 2.5 million were receiving the new State Pension.1

The old and new State Pension

Whether you receive the old or the new State Pension depends on when you reach the State Pension age.

The full new State Pension is currently £203.85 per week (£10,600.20 each year) for those who reached State Pension age on or after 6 April 2016.

Those who reached State Pension age before 6 April 2016, will receive the full basic State Pension of £156.20 per week (£8,122.40 each year), and possibly a State Earnings Related pension on top.

Entitlement based on National Insurance Contributions

Your State Pension income is based on the number of qualifying years of National Insurance contributions (NICS) you have paid normally while working, including any NI credits if you cannot work. You can read more about qualifying years on GOV.UK’s website The new State Pension: Your National Insurance record and your State Pension.

To receive the full new State Pension, you need to have built up at least 35 qualifying years of NICs or NI credits. If you have at least 10 but less than 35 qualifying years, you’ll be entitled to receive a reduced State Pension. Having more than 35 qualifying years of NICS or NI credits won’t increase your State Pension.2  

The earliest you can claim the State Pension is based on your State Pension age. It’s possible to delay taking your State Pension, if you want to.

2. State Pension ‘triple lock’

Each April the new and old State Pension increases in line with the ‘triple lock’. This is the government’s guarantee that the State Pension will increase by whichever is the highest of either:

  • Average wage growth between May and July (compared to the 3 months in the previous year)
  • Inflation using the Consumer Price Index (CPI) in the year to September
  • or 2.5%.

The ‘triple lock’ was suspended in April 2022, for one year only. Instead, the State Pension was increased in line with a ‘temporary lock’. The government did this because wage figures were being skewed by the furlough scheme. However, the triple lock was reinstated in April 2023, when the old and new State pensions increased in line with the September 2022 CPI index of 10.1%.3

Both wages growth and inflation are currently well above 2.5%. All eyes will be on these indexes, to see how much the State Pensions will increase in April 2024.

3. Increase in State Pension age is doubling poverty rates

The State Pension age is gradually increasing, now age 66 for men and women, having increased from age 65 between 2018 and 2020.4

According to research by the Institute for Fiscal studies (IFS), the recent State Pension age increase meant that 700,000 65-year-olds had to wait another year before they could receive their State Pension. This meant missing out on a State Pension income of £142 per week (£7,384 a year) on average.5

This delay in the State Pension income has directly increased the absolute income poverty rate to 24% for 65-year-olds as of late 2020. This is an increase of 14 %, or nearly 100,000 people, according to the IFS.5

The IFS research also shows that the number of 65-year-olds in absolute poverty increased from one in ten before the State Pension age increase in 2018, to one in four only two years later in 2020.5

The absolute income poverty rate is where household income is below 60% of the median income in a base year – it’s changed in line with inflation.

The State Pension will rise further to age 67 between 2026 and 2028 for those born on or after April 1960. Another gradual rise to age 68 is due between 2044 and 2046 for those born on or after April 1977.6

4. The State Pension age is under review by the government

The government recently reviewed the State Pension age to see if the current approach was still working. Factors they considered include an increasing life expectancy, a growing ageing UK population and how to manage costs so they’re sustainable and fair between generations.

Following the review, the government announced that there would currently be no further changes to the State Pension age. This means they’ll continue with the planned increase from 66 to 67 between April 2026 and April 2028 – and a further increase from 67 to 68 between April 2044 and April 2046.4 However, the government has committed to another review of the State Pension age to reconsider the timeline for increasing it to age 68, which may decide to bring this increase forward.6

5. Pensioners are being urged to claim pension credit

As of June 2022, over 1.4 million UK pensioners are receiving pension credit, which can be worth over £3,300 a year. However up to 850,000 eligible households aren’t claiming pension credit, leaving an estimated £1.7 billion in benefits unclaimed.7

The government is running campaigns to encourage more State Pensioners on low incomes to claim pension credit. People are being encouraged to talk to their elderly relatives and neighbours to spread the word.7 With the rise in the cost-of-living crisis, it’s important that everyone who is eligible claims pension credit. This would not only provide a higher retirement income, but also gives pensioners an entitlement to other government means-tested benefits. For example – council tax reductions, the cost-of living energy funding help, warm home discount, housing benefit and other benefits including a free TV licence for over 75s.

How to claim pension credit

You can use the Pension Credit calculator to work out how much you might get. You can claim online at gov.uk/pension-credit/how-to-claim or ring the pension credit claim line 0800 99 1234 (call charges will vary).

Remember your other sources of retirement income

For most people the State Pension won’t be enough to live on. So it’s important, if you’re able, to continue to save and plan for your future life post work. This includes saving in a pension and other savings and investments. If you’re in a workplace pension, remember that your employer will contribute towards your future on top of your own pension contributions. 

If you want to learn more about the State Pension, you can read our original guide: What is the State Pension and how does it work? on our money tips hub.

This article isn’t intended as financial advice. If you're unsure what to do or you need advice, please speak to a financial adviser. You can find a financial adviser near you at MoneyHelper

  1. DWP benefits statistics: August 2022. Data source, GOV.UK, August 2022.
  2. Your National Insurance record and your State Pension. Data source, GOV.UK, August 2022.
  3. Consumer price inflation, UK: March 2023. Data source, Office for National Statistics, April 2023.
  4. State Pension age Review 2023. Data source, GOV.UK, March 2023.
  5. Latest increase in state pension age from 65 to 66 led to income poverty rates among 65-year-olds more than doubling. Data source, Institute for Fiscal Studies (IFS), June 2022.
  6. Second State Pension Age Review launches. Data source, GOV.UK, January 2022.
  7. Eligible pensioners urged to claim Pension Credit to help with cost of living. Data source, GOV.UK, June 2022.


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