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State pension triple-lock survives in DUP and Conservative deal

The Conservative Party and the DUP have struck a deal to form government – how will it affect your finances?

State pension triple-lock survives in DUP and Conservative deal

There will be no changes to the state pension triple lock or winter fuel payments under the new agreement between the Conservative party and the DUP, signed today. 

The state pension triple lock is a system which guarantees that your weekly pay will rise each year in line with either inflation or earnings, or by 2.5% if the other measures are lower.

In its election manifesto, the Conservative party pledged to replace the triple lock with a ‘double lock’ in 2020, doing away with the 2.5% minimum threshold.

Under the deal with the DUP, the Conservative government have agreed to keep the triple lock in place.

The triple lock policy was left out of the Queen’s Speech opening parliament last week, fuelling speculation that the Conservative government were likely to back down from their proposed plans.

What does that mean for my state pension payments?

The state pension you get differs depending on when you qualified for it.

If you reached state pension age – currently age 65 for men and around 63 for women – before 6 April 2016, you get a combination of the basic state pension, which is £122.30, and any additional state pension you may have built up.

If you reached state pension age on or after 6 April 2016, you qualify for the ‘single tier’ state pension. This is currently £159.55, but could be more or less depending on the amount of additional state pension you’ve built up and the kind of private pension scheme you have.

We’ve explained how this works in a guide to how much state pension you’ll get.

With the 2.5% increase remaining in place,  recipients of the basic state pension could see their pay rise to:

  • £125.35 a week, or £6,518 a year, in 2018
  • £128.49 a week, or £6,681 a year, in 2019
  • £131.70 a week, or £6,848 a year, in 2020

People receiving the higher single tier state pension could see their pay rise to:

  • £163.54 a week, or £8,504 a year, in 2018
  • £167.63 a week, or £8,716 a year, in 2019
  • £171.82 a week, or £8,934 a year, in 2020

These figures could be higher, of course, if inflation or earnings are higher. Inflation, as measured by the consumer price index, is currently 2.9% and is forecast to increase further throughout the year.

Will the state pension age go up?

Not mentioned in the terms of the DUP/Conservative agreement was a decision on whether or not to increase the state pension age.

The previous Conservative government had been due to make a decision on bringing forward when the state pension age will increase from 67 (which will occur in 2028) to 68.

This was due to be introduced by 2048, but a report commissioned by the government recommended this be brought forward to 2039.

Do I qualify for winter fuel payment?

Winter fuel payments are given to older people to help towards the cost of utility bills.

You can get up to £200 if you were born on or before 5 May 1953, and up to £300 if you’re aged 80 or over. The Conservatives had planned to means-test the payment based on your income, but the DUP had stated they would fight any ‘assault’ on this kind of benefit.

What happens next?

The deal will see the 10 members of parliament in the DUP backing the Conservative party, which is nine seats short of a majority, in major votes.

This includes the Queens Speech, which lays out the government’s legislative agenda over the next two years, as well as the Budget, which will take place in the Autumn this year.

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