Millions of pensioners could be set for a £655 increase in 2025.

Under the triple lock – which guarantees an increase in line with average earnings, inflation or 2.5%, whichever is highest – pensioners would have been in line for a rise linked to wages from April.

The highest of the three figures is the increase in average earnings, which was measured by the Office for National Statistics (ONS) at 5.7%.

How much could your pension increase by?

A 5.7% rise in the full new state pension could take it from around £221 per week to £233, or from around £11,500 to around £12,157 annually.

Helen Morrissey, head of retirement analysis at investment platform Hargreaves Lansdown, told consumer experts Which?: "Inflation may be on the wane but wage growth remains red hot coming in at 5.7%. 

"If it remains at a similar level, we would see the full new state pension rise to more than £12,100 per year.

"Such a rise would be welcomed by pensioners who have been buffeted by the cost-of-living crisis. It may not be on the scale of increases given in the past, but it will still make a sizeable difference to people’s day-to-day spending."

Winter Fuel Payments scrapped

Only those on Pension Credit or means-tested benefits will get the Winter Fuel Payment going forward - those on the credit will get £200 and £300 if someone is over 80.

The announcement, made by Chancellor Rachel Reeves last week, drew criticism from a number of commentators.

Among them was Money Saving Expert Martin Lewis.

He took to X, formerly known as Twitter, to say: "The Energy Price Cap is likely to rise 10% this October and stay high across the winter, leaving most energy bills nearly double that pre-crisis, at levels unaffordable for millions.

"Many pensioners eke out the £100 to £300 Winter Fuel Payments to allow them to keep some heating on through the cold months. While there's an argument for ending its universality due to tight national finances, it's being squeezed to too narrow a group – just those on benefits and Pension Credit.

"Yet again, those just above the thresholds will be hardest hit. This is often justified as there's a 'lack of household income data' to allow other targeting. However, there's a usable precedent from the emergency energy crisis measures announced in April 2022, which I'd urge the Government to look at. Then, a payment was made to homes in council tax bands A to D – as an imperfect but workable proxy for lower household incomes.

"That'd allow an additional group of lower to middle-income pensioners to keep the payments and mitigate bill shocks. Councils' discretionary funds could also be funded as in April 2022, for the limited numbers who still need help but don't qualify.

"Plus, with this announcement, the Government has a huge moral imperative to ensure the 800,000 people eligible for Pension Credit who don't get it, are informed, educated and helped through the process.

"It is planning an awareness-raising campaign, but it needs to ensure that reaches every corner – and if possible proactively and personally contact people.

"Pension Credit is a crucial gateway benefit, giving access to a host of other entitlements, and now with the link to the Winter Fuel Payment, it makes it even more important to ensure fewer miss out."