State pension set to increase by £460 – but too late for winter bills
The new state pension is due to rise by £460 next April, but this is likely to provide cold comfort for thousands of pensioners facing steep hikes in energy bills this winter.
Any rise in the state pension is usually subject to the government’s ‘triple lock’ guarantee. This means that it must increase by either September’s price inflation, average wage growth between May and July, or 2.5%, whichever is higher.
Wage growth stood at 4%, the Office for National Statistics announced this week, and with next week’s inflation number expected to be lower than this, the state pension is therefore likely to rise by 4% in April. This would add £8.80 a week onto the new state pension, bringing the maximum weekly amount up from £221.20 to £230.05.
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However, pensioners receiving the old state pension, equivalent to more than 9.3m people, will see their pensions increase by a lower amount of £6.48 a week, taking the weekly amount from £169.50 to £176.28 from April 2025.
These increases won’t kick in for another seven months, which means pensioners won’t be protected from rising energy costs this winter, especially as the vast majority are set to lose the Winter Fuel Payment which provided up to £300 to help with energy bills. According to analysis by charity Age UK, 2.5 million older people on low incomes - a higher number than first estimated - will struggle to make ends meet without it.
Lily Megson, policy director at My Pension Expert, said, “With the state pension set to rise in line with wage growth, this increase will offer some additional support for retirees who have struggled under huge financial strain in recent years. However, while the triple lock remains an important safeguarding measure, a rise alone won’t solve the broader financial challenges facing pensioners.
“The cost-of-living crisis has taken its toll, and the decision to cut the winter fuel payment for most households will be particularly harsh, especially with energy prices remaining high. Many pensioners will face a gruelling winter and so, while the state pension increase is welcome, it will fall short of fully protecting pensioners from rising costs.”
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You’ll only be eligible to receive a Winter Fuel Payment this year if you were born before 23 September 1958 and claim Pension Credit or other qualifying benefits by the qualifying week of 16-22 September.
Caroline Abrahams CBE, Charity Director at Age UK said: "The government has tried to suggest that the increase in state pension for older people next year as a result of the Triple Lock means there's no need to worry about how they will cope now, but that won't help anyone this winter and most pensioners will not benefit to the extent being suggested - either because they are on the old state pension which attracts less of an increase, or because they don't qualify for a full state pension in the first place.”
If you’re worried about covering bills and aren’t eligible for Pension Credit, it’s worth seeing if you can get any help from the Household Support Fund, which has been extended until April next year to help households struggling with bills. Check with your local council to find out what support is available.