What is the State Pension triple lock?

First announced in 2010, the triple lock is a UK government commitment to increasing the State Pension each year. 

This ensures that the State Pension’s value doesn’t decrease in real terms compared to the rising cost of living. In turn, this protects pensioners’ spending power.

Each new tax year, the State Pension rises by the highest of three metrics.

• Inflation - this measures how quickly prices are rising. The figure used for the State Pension is the rate of increase in the 12 months to September of the previous year.
• The increase in average earnings - using the data from May to July of the previous year.
• 2.5% - a flat increase if neither inflation nor average earnings increased much over the year.

For example, if average earnings and inflation were to only increase by 2%, the State Pension would still rise by 2.5%. 

But if average earnings were to increase by 3%, the State Pension would also increase by 3%.

The government did suspend the triple lock once for 2022/23. This was due to higher earnings growth as people returned to work after the end of the furlough scheme during the Covid-19 pandemic. Instead, they used the inflation rate.

Otherwise, it has increased by one of the three metrics since its introduction in the 2011/12 tax year.

How does the pension triple lock affect me?

The triple lock could be useful for you in later life as it’s a valuable part of many people’s retirement income. By increasing the amount you receive, it ensures that your State Pension payments retain their spending power.

To be able to claim it, you’ll need enough credits on your National Insurance (NI) record. You’ll get these from working, or if you claim certain benefits. 

You’ll receive the full State Pension if you have 35 years of credits on your NI record. In 2026/27, the full new State Pension is £241.30 a week. The full basic State Pension (for those who reached State Pension age before 6 April 2016) is £184.90 a week. You’ll receive some State Pension if you have at least 10 years on your NI record.

While the State Pension isn’t realistically enough to live on entirely, it could make a difference to your overall retirement income. And knowing that you have a regular income that will rise in line with the cost of living can help with your retirement planning.

Could there be changes to the triple lock?

The other big way the triple lock could affect you and your retirement planning is if it’s changed or removed.

Research suggests that by the 2070s, spending on the State Pension will increase by around £80 billion (in today’s terms). Over half of that is projected to be down to the triple lock. These concerns make it a regular topic of conversation in government.

There’s also the fact that it’s likely for State Pension income to become taxable from 2027/28. 

In 2026/27, the first £12,570 of your income is covered by your Personal Allowance, meaning you pay no Income Tax. 

However, the full new State Pension pays around £12,547.60 a year. Even the minimum increase of 2.5% could make State Pension payments taxable from next April (2027). 

With the Personal Allowance frozen until 2031, there’ll need to be some debate as to how to handle this.

So what might happen?

For one, we could see the triple lock replaced with a double lock. This would involve the flat 2.5% option being removed. Under this system, the State Pension would only rise in line with inflation or earnings growth.

Or we might adopt the Australian approach of a single ‘smoothed earnings link’, as suggested by the Institute for Fiscal Studies (IFS).

A more radical approach could see the State Pension itself completely scrapped and replaced. For example, former Prime Minister Tony Blair’s thinktank recommends a ‘Lifespan Fund’. This would also use a smoothed earnings link, while changing the way your entitlement to it is measured.

None of these options are certainties. For now, the triple lock is in place and the government’s committed to it.

Save for your future with PensionBee

The State Pension is already unlikely to be enough for a retirement income on its own. Plus, changing or scrapping the triple lock could make it even less useful for younger savers.

That’s why it’s sensible to see the State Pension as an additional income to private pensions, and not the other way round.

Get started with PensionBee today and let us help you take control of your retirement. Combine your old pensions into one online plan with a clear balance you can check at any time.

By saving into a pension, you can build a pot that ensures you have what you need to enjoy the retirement you want.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.