Chancellor receives ‘unwelcome’ £100mn state pension bill

Today (October 15), the ONS released its Labour Market Overview for October 2024, detailing the revised figures for average earnings growth in the three months to July this year, which are “crucial” when calculating the triple lock.

Last month the provisional estimate was 4 per cent growth when compared to the same three month period in 2023 but, today, this has been raised to 4.1 per cent.

Webb pointed out that this extra 0.1 per cent adds around £100mn to the state pension bill under the triple lock formula.

The triple lock applies to the old “basic” pension, which costs £68.4bn this year, and the new state pension, which costs £45.8bn.

This equates to a total cost of £114.1bn, an extra 0.1 per cent of which is £114mn and, after adjusting for pensions paid to frozen countries, suggests a total figure of around £100mn for the extra cost of today’s revision.