I have concluded my statutory annual review of state pension and benefit rates under the Social Security Administration Act 1992. The new rates will apply in the tax year 2025-26 and will mainly come into effect from 7 April 2025.
I am pleased to announce that the basic and new state pensions, and the standard minimum guarantee in pension credit, will be increased by 4.1%, in line with the increase in average weekly earnings in the year to May-July 2024.
This demonstrates our commitment to supporting pensioners, by protecting the triple lock, which benefits over 12 million pensioners. From April, the full yearly rate of the new state pension will increase by over £470.
Other state pension and benefit rates covered by my statutory review will be increased by 1.7%, in line with the increase in the consumer prices index in the year to September 2024.
This includes universal credit and other benefits; statutory payments linked to participation in the labour market; and additional state pension and pension credit elements other than the standard minimum guarantee.
These increases will apply across Great Britain.
In England and Wales, personal independence payment and other benefits to help with additional needs arising from disability, and the rate of carer’s allowance, will also increase by 1.7%. In Scotland, these are devolved matters.
All of social security, including state pensions, is a transferred matter in Northern Ireland.
I will place the full list of proposed state pension and benefit rates for 2025-26 in the Libraries of both Houses in due course.
Although not covered by my statutory review of state pension and benefit rates, I can also inform the House that local housing allowance rates for 2025-26 will be maintained at the 2024-25 levels, following their increase in April 2024; and that the benefit cap has not been reviewed for 2025-26 and will also be maintained at the 2024-25 levels.
[HCWS175]