State pension could rise by 10.1% next year – but only if triple lock remains

The state pension could be worth more than £10,000 for the first time ever next year, after September’s inflation hit 10.1%.

The Office for National Statistics (ONS) confirmed today that September’s Consumer Prices Index (CPI) measure of inflation measured 10.1%, up from 9.9% in August.

This figure relates to the state pension payment, as payments are usually protected by the triple lock system. This means that from April 2023 it would increase by either September’s rate of inflation, average earnings growth (as of July) or a guaranteed minimum of 2.5%, whichever is higher. 

However, there's been some confusion about whether or not the triple lock will be enforced. Interviews with the new Chancellor Jeremy Hunt concluded he would not commit to it, while Prime Minister Liz Truss later told the House of Commons that the triple lock would be maintained.

Here, Which? reveals how much the state pension could rise by, and how to check how much you could get.

How much could the state pension pay in 2023?

If the state pension rises by 10.1% – in line with September’s CPI inflation – pensioners who are entitled to the full new single-tier state pension will get £203.85 a week from April 2023, up from £185.15 this year. 

This change means that pensioners will be £972.40 better off by the end of the 2023-24 tax year, taking their total income to £10,600.20.  

But remember that what you get depends on your National Insurance record, so you could get less.

Pensioners who reached state pension age before April 2016 and receive the basic state pension will see their weekly payments rise from £141.85 to £156.20

This amounts to a £746.20 pay rise in 2023-24, with income rising to £8,122.40  

• Find out more: how much could the state pension rise by next year

What is the triple lock?

State pension payments are usually protected by a triple lock guarantee, which was first introduced in 2010 by the Conservative-Liberal Democrat coalition government. 

This means that payments are increased each year by whichever rate is higher out of:

• September’s Consumer Price Index (CPI) – a measure of inflation 
• Average earnings growth (as of July)
• Guaranteed minimum of 2.5%.

However, the triple lock was reduced to a double lock for 2022-23 to address a quirk in wages growth following the pandemic; a swift recovery in wages would have qualified pensioners for an 8.3% state pension hike. Instead, it increased by 3.1%, in line with inflation.

As it stands, Prime Minister Liz Truss confirmed to the House of Commons on Wednesday (19 October) that the triple lock will be reinstated for the 2023-24 financial year. 

Just days before, however, Chancellor Jeremy Hunt refused to commit to it when questioned by Labour MP Emma Hardy in the Commons on Monday (17 October). 

He said: ‘I'm very aware of how many vulnerable pensioners there are and the importance of the triple lock.

‘But as I said earlier, I'm not making any commitments on any individual policy areas, but every decision we take, will be taken through the prism of what matters most, to the most vulnerable.’

If the Conservative party were to raise the state pension with earnings instead of CPI, it would only increase by 5.5%. 

• Find out more: mini-Budget: what was announced and what’s changed since

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When will it be confirmed?

Last year, the increase was officially confirmed in November after The Social Security (Up-rating of Benefits) Act 2021 received Royal Assent.

When will state pension payments increase?

Pensioners will get the raise in April 2023. It’s usually the first Monday in the new tax year, so you're likely to see the change on Monday 10 April. 

How much additional state pension will I get?

If you reached state pension age before April 2016, the state pension you receive is made up of two amounts – the basic state pension and an additional state pension.

The additional state pension isn't linked to the triple lock guarantee and instead increases according to CPI inflation each year.

The amount you get depends on the number of National Insurance contributions (NICs) you made before you retired, your earnings, whether you contracted out and if you topped up your basic state pension. But if you receive any additional state pension, you will see a rise of 10.1% from April 2023. 

You might earn more than this if you've built up some additional state pension – known as your 'protected payment'. This will also rise in line with September's CPI inflation, so you'll see a 10.1% increase from 6 April 2023.

• Find out more: Second State Pension and Serps explained

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The rise in public sector final salary scheme

The September CPI inflation figure of 10.1% will also determine how much public sector (eg NHS, teachers' and civil service schemes) final salary pensions rise by next year for those in receipt of pension payments or deferred members.

Some active members of public sector pensions do still get annual increases more than the CPI rate. This is outlined each year in the so-called Treasury Orders.

Scheme regulations for newer public pensions stipulate teachers receive an increase of CPI plus 1.6% (11.7%), NHS workers CPI plus 1.5% (11.6%) and those in the police CPI plus 1.25% (11.35%). Judicial, local government pension schemes and civil service pensions only receive increases equal to CPI.

How to check your state pension

The state pension is a benefit paid by the government to those who have reached state pension age.

The amount you get depends on how many NICs you've made during your working life.

You need at least 35 qualifying years of contributions to qualify for the full new state pension and at least 10 years' worth to receive anything at all. If you reached retirement age before April 2016, you'll need 30 years of contributions to get the full basic state pension.

For anyone who hasn't yet reached state pension age, you can use an online government tool to check your state pension forecast, which will tell you how much you can get, when you can start receiving payments and whether you're able to increase it.

• Find out more: your state pension forecast explained

What's going on with inflation?

Inflation returned to July's figure of 10.1% in September after having fallen in August to 9.9%. 

The ONS said that the increase was driven by food prices, leaping by 14.5% compared with the same month last year, representing the largest annual rise for 40 years.

The continued fall in the price of motor fuels made the largest, partially offsetting, downward contribution to the change in the rates.

• Find out more: cost of living news and advice

This article was first published on 19 October 2022. It was updated on 27 October to rectify figures of how much pensioners who reached state pension age before April 2016 could expect to receive next year.