The UK state pension is due to rise £460 annually from next April, new earnings data suggests.
The Office for National Statistics (ONS) said total pay increased by 4% in the three months to July.
Under the arrangement called the "triple lock", the state pension will increase annually by 2.5%, in accordance with earnings, or in line with inflation - whichever is the highest figure.
Inflation data for September has not yet been published. It stood at 2.2% for July, according to the Office for National Statistics (ONS).
As inflation is not expected to be higher than wage growth, the wages figure is likely to be used for the calculation.
Pay excluding bonuses grew by 5.1% in the year to May to July 2024; including bonuses it was up 4.0%, though this comparison is affected by last year’s NHS and civil service one-off payments.
— Office for National Statistics (ONS) (@ONS) September 10, 2024
Read Labour market overview ➡️ https://t.co/LADdyoefyv pic.twitter.com/So7ERyAv1Q
People who reached state pension age after April 2016 can expect to see their full, flat-rate state pension go up to £11,962.60 a year.
It follows pensioners getting a rise of 8.5% last year, and comes as the government defends its decision to cut the winter fuel payment.
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, said the rise in the state pension will only partially offset the pain for the millions of retirees who are being stripped of their winter fuel allowance.
She said: “There’s every chance it’s not enough to placate those pensioners still reeling from the loss of the winter fuel payments, especially given how close this is edging to busting the personal allowance.”
She said the new annual pension is moving closer to the £12,570 personal tax allowance.
“Given that the freeze to this threshold is expected to remain in place until 2028, it raises the spectre of the full state pension alone taking pensioners over it and into the realms of paying income tax during the next few years,” she said.
On a post to X, formerly Twitter, MoneySavingExpert founder Martin Lewis pointed out the rise of £460 is “good news and a real rise of about £200 above inflation”.
“Yet there are two things I'd point out in the context of the debate about the winter fuel payment,” he added.
“That starts next April. This winter most pensioners are facing (looking at energy bills alone) a typical £500 higher cost compared to last (energy bills are £100ish cheaper, but no £300 cost of living payment, no up to £300 winter fuel payment).
“The full state pension rise is for those who get the full state pension. There are up to 800,000 of the poorest pensioners who get less than the full state pension (£11,400 a year) who aren't claiming pension credit and will miss out on the winter fuel payment even though they should get it.
“They are very hard to reach and will be under huge financial pressure. These are therefore people the govt said should be helped but due to difficulties in the system won't be.
“These are the people I'm most worried about, some of whom may end up choosing between heating and eating.”
