Some people get extra payments on top of their state pension
State pensioners have just received their usual April uplift thanks to the triple lock, but some might be taken aback to find out about an extra little bonus – though it’s only for 25p a week. You’re entitled to this modest top-up once you turn 80 if you’re receiving the basic state pension, which sweetens your annual income by £13.
If you were born on or before 1944 or have celebrated your 80th birthday this year, you should get this additional amount. The DWP sends out a letter to eligible individuals about the boost when it’s their time.
Yet the policy has never been uprated, despite the fact it would now be worth £150 a year more had it gone up in line with inflation. This small perk isn’t available for those on the new state pension, which applies to those reaching state pension age after April 2016.
The top-up originated over half a century ago in 1971, when the state pension stood at £6 weekly, so the extra 25p represented a significant 4% increase. The DWP said previously that the additional cash for the over-80s was provided because they “need help rather more than others”. The department was asked why it has not increased the amount and if it had considered bringing in a similar scheme.
A Government representative said: “We are determined to support pensioners and our triple lock commitment means millions are set to see their state pension rise by up to £1,900 this Parliament. More widely, as part of our Plan for Change we have raised the national living wage, increased benefits and given additional help to the poorest households.”
The group added that it has “no current plans” to adjust the 25p additional amount. A parliamentary question recently uncovered that the estimated cost of the extra 25p weekly for eligible recipients is £50.8 million for the 2024/2025 financial year.
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Yet some retirement experts argue that the time has come for the 25p supplement to go up. Tom Blake, founder of Money Saving Guru, calculated it would be worth roughly £3.20 per week, or an annual £166, if it had kept pace with inflation. This means meaning it would be worth £150 more than it currently provides.
Mr Blake said: “People living well into their 80s and 90s are much more likely to be managing long-term health conditions, paying for home help or care services, and facing higher energy costs simply to stay warm. These aren’t discretionary expenses, they’re necessities and yet the financial support of the pension system hasn’t evolved to reflect that.”
The expert outlined a proposal where an age-related increase could be “targeted” while remaining financially viable for the Treasury: “It could kick in at 80 or even be tiered further at 85 or 90.
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“A modest uplift of £3 to £5 each week would align much closer with the current economic climate than the longstanding 25p. Such an uptick wouldn’t cost as much as a universal state pension rise but would provide a significantly larger relative benefit for the individuals who receive it.”
State pension payments rose 4.1% increase in April, following the triple lock system. This ensures state pension rates rise in accordance with the highest of 2.5%, average earnings growth or inflation. Following this uplift, the full basic state pension now stands at £176.45 per week, while the full new state pension is £230.25 weekly.
To qualify for the full basic state pension, you typically need 30 years’ worth of National Insurance contributions, and for the full new amount, you usually need 35 years’ worth.
