The Triple Lock policy has been making headlines recently
State pensioners born after 1951 could be in for a financial boost, with a potential £657 increase on the cards under the Triple Lock proposal. For the 2025/26 tax year, anyone eligible for the full new State Pension can expect to pocket £11,973 annually or £230.25 each week.
Thanks to the Triple Lock being tied to an impressive 5.5% earnings growth, weekly state pension payments might see a spike to £242.90. That’s nearly £972 over four weeks and leads to a favourable yearly sum of £12,630.80.
The Triple Lock scheme is DWP’s promise to uprate pensions yearly based off the highest of three measures: average annual pay bump observed from May to July, CPI come September, or a fixed rate of 2.5%. This comes amid the UK’s economy facing a slight 0.1% dip in growth this past May, despite the Office for National Statistics (ONS) revealing positive signs, with GDP hopping up by 0.5% in the March to May 2025 quarter, just above the expected 0.4%.
Professor Joe Nellis, expert at MHA, said: “This is a far cry from the strong growth in the first quarter of the year when a surge in exports and a robust performance in the services sector placed the UK among the G7’s top performers. Growth over the first half of the year is now expected to be modest.
“Despite a more positive outlook for the remainder of the year, this presents a challenge to the Chancellor – her fiscal headroom remains limited by high levels of public borrowing and debt and her spending plans are heavily reliant on kickstarting the economy.
“Just as last year, we now wait tentatively for the Autumn Budget to find out how the Chancellor aims to solve her fiscal problems.”
READ MORE: DWP Universal Credit claim rule change you may not know aboutREAD MORE: DWP benefit payments may be cut by 15% in certain circumstances – are you affected?
Mr Nellis added: “Something must change – she must either cut spending, increase borrowing, or raise taxes. We expect a squeeze on unprotected Government budgets to cut spending, but the recent rebellion in the Labour Party against the welfare reform bill shows that major spending cuts may be too politically dangerous for the Government.
“The OBR’s July report highlighted the intense burden that the triple lock on the state pension places on the UK economy – demographic and economic shifts have made this policy difficult to uphold, but any attempt to undo it would move the Government into treacherous waters.”