The Government is committed to supporting current and future generations of pensioners and giving them the dignity and security they deserve in retirement.

We have made a commitment to the Triple Lock for this Parliament which will mean spending on people’s State Pensions is forecast to rise by over £31 billion. As a result, by the end of the Parliament, the yearly State Pension of over 12 million pensioners will be up to £1,900 higher.

The State Pension and the National Living Wage have different purposes, and a direct comparison cannot be drawn. The National Living Wage is designed to protect low-income workers and provide an incentive to work.

It is also worth noting that while State Pension is an entitlement based on a person’s National Insurance record, it is legally a benefit. From the time of the 1946 National Insurance Act, which applied from the inception of the National Insurance scheme, retirement pension (latterly also known as State Pension), has always been classified in law as a 'benefit'.

Our system of state, private, and workplace pensions provides the basis for security in retirement. The new State Pension was introduced in 2016 to be a simpler, clearer, sustainable foundation for private saving, including workplace pensions supported through Automatic Enrolment. The introduction of Automatic Enrolment has both increased and equalised workplace pension participation rates between eligible men and women in the private sector.
Together, the new State Pension and Automatic Enrolment provide a robust system for retirement provision for decades to come, with those on low incomes supported by Pension Credit which continues to provide a safety net.

Pension Credit is a means tested benefit which provides extra money to help with daily living costs for people over State Pension age and on a low income. Pension Credit tops up other retirement income to a minimum amount - currently set at £218.15 a week for a single pensioner and £332.95 for a couple. People with certain housing costs, a severe disability, carers and those who are responsible for a child or young person can get more.

Receipt of Pension Credit also opens the door to a range of other financial support, including help with rent, council tax, fuel bills and a free TV licence for those over 75. Around 1.4 million pensioner households are receiving Pension Credit and the Government is forecast to spend around £6 billion on Pension Credit in 2024/25.

There are no plans to bring State Pension age back down to 60. Increases to State Pension age have been in legislation since the Pensions Act 1995, which legislated to equalise State Pension age for both men and women to age 65. There have since been a number of legislated increases to State Pension age introduced under successive Governments. State Pension age is currently 66 and set to rise to 67 between 2026 and 2028 and to 68 between 2044 and 2046.

Under the Pensions Act 2014, the Government has a statutory duty to periodically review whether the rules about State Pension age remain appropriate. To date there have been two Reviews - one in 2017, and the latest in 2023. The next Government Review must be completed by March 2029.

The State Pension is a pay-as-you-go system funded by current taxpayers. This means that the pensions paid out today are financed from National Insurance and other tax revenues collected today. Therefore, projected differences in the growth of the pensioner population and that of the working-age population has an impact. There were 280 pensioners for every 1000 people of working age as of 2020. This will increase rapidly from the 2030s and will reach levels never seen before by 2070, where the ratio is projected to be 393 pensioners per 1,000 people of working age. In 2024/2025, it is forecast that the total spend on State Pension will be £138 billion, or 5.2% of GDP. The latest projections are that by 2073 to 2074, as a result of increasing life expectancy and a growing pensioner population, spending on State Pension is projected to be 7.9% of GDP.

For people who have not reached State Pension age the Government is committed to providing a financial safety net for those who need it. Support is available through our benefits system for those who are unable to work or are on a low income but are not eligible for pensioner benefits because of their age.

Department for Work and Pensions