State pension to rise by 8.5% in 2024. What does the triple lock mean for you?

Pensioners could see their payments boosted by up to an additional £902.20 in 2024 thanks to the government’s triple lock commitment.

The 8.5% rise on this year’s payment means that the state pension will remain in line with wage inflation.

The triple lock was introduced in 2010 to ensure pensioners receive an uplift in payments at the same rate of whichever is highest out of earnings, inflation or 2.5%

The triple lock is applied to both the basic (pre-April 2016) and the new state pension (post-April 2016).

An 8.5% rise would see payments rise by:

• £691.60 on the basic state pension taking it to £8,814 a year
• £902.20 on the new state pension taking it to £11,502

The triple lock was suspended in the 2022-23 tax year for 12 months. The treasury reintroduced it in November 2022, resulting in state pension income rising by 10.1% from last April, in line with inflation.

Next year’s increases are based on average growth figures which were inflated because of bonuses paid to public sector workers.

This has resulted in talk that the government might strip out the bonuses, resulting in pensioners only receiving an increase of around 7.8%, meaning some could lose out by £75 a year.

What’s the state pension?

The state pension is a regular payment from the government that most people claim in later life. Men and women are currently entitled to the state pension at the age of 66, but this is scheduled to rise.

State pension comes in two tiers – the basic state pension and new state pension.  

Anyone who turned 66 on or after 6^th April will receive the new state pension. Anyone born before this time will be on the basic pension.

In 2022/23 pension payments were paid at:

• £156.20 a week for the basic pension
• £203.85 per week for the new state pension

If you claim the state pension, you may also be entitled to pension credit and other associated benefits to top up your income.

What’s the triple lock?

The triple lock is a government guarantee that state pensions grow each year in line with whichever is the highest out of the following three measurements:

• The average growth measured from May to July compared to the previous year
• The consumer prices index (CPI) measured in the year from September
• Or 2.5%

In its 2019 election manifesto, the Conservative party said it would keep the triple lock in place for the duration of this parliament, which ends in 2024.

The triple lock may be even more important to future generations. Younger people are less likely to have the security of financial salary workplace pensions and will be more dependant on other sources of income (including the state pension).