State pensioners could get £920.40 pay rise under ‘revised’ figures | Personal finance

State pensioners could see their DWP payments rise next April by twice the expected amount, which will boost their full new state pension by £920.

This week, figures were released on average earnings that are taken into account in calculating the triple lock, which would mean a four per cent increase in payouts, but an expert said the figure could be revised upwards.

Victoria Harris, co-founder of The Curve Platform, said: “The possible revision of triple-collateral earnings data is a hot topic.

“While it is too early to determine an exact number, we can expect an increase of around 7 to 8 percent based on current projections. This would be a significant boost for retirees.”

The eight per cent rise would see the full new State Pension increase from the current £221.20 a week to £238.90 a week, an increase of £920.40 a year to £12,422.80.

It would also mean the full new state pension would be just over £150 off income tax, compared with the current tax-free allowance of £12,570 a year.

Ms Harris said another unknown factor was how the inflation rate might affect the triple lock calculation.

She explained: “We need to consider the wider economic implications. Inflation is the unknown here. If it continues to rise in the coming months, we could see even bigger pension increases.

“This could be a double-edged sword – great for retirees in the short term, but potentially difficult for the economy as a whole.”

If this week’s 4% earnings rise proves to be the key figure, the full new State Pension will rise from £221.20 a week to £230.05 a week, an increase of £460 a year.

Another analyst said the state pension could differ from this predicted amount. Yiannis Zourmpanos, a financial consultant and senior associate at Bountii, said: “The Office for National Statistics (ONS) frequently revises its earnings figures, meaning the expected increase in your state pension may not be the one you receive.”

The ONS is known to produce updated figures that more accurately reflect actual earnings growth over a given period.

“This means we may see a different percentage used to increase state pensions when the final calculations are made.”

Turning to inflation, Mr Zourmpanos warned: “Although inflation was 2.2 per cent in July, we are not out of the woods yet.

“Inflation tends to be unpredictable and if it rises sharply before the key September data is released, it could outpace earnings growth.

“If that happens, inflation — not earnings — will determine state pension increases in 2024. And with the rising cost of essential goods like food, energy and housing, inflation may well take the lead.”