A rising state pension age
Raising the state pension age is one of the main levers used to contain cost. The age is scheduled to rise from 66 to 67 for men and women between April 2026 and March 2028, and the OBR estimates that this single change reduces net borrowing by about £10.5 billion in 2029-30 compared with keeping it at 66 (OBR, box; gov.uk, subject to change).
How the saving breaks down (OBR estimate, 2029-30). Of the roughly £10.5 billion net reduction in borrowing from raising the state pension age to 67, the OBR attributes about £10.4 billion to lower state pension eligibility and around £0.9 billion to extra employment and tax revenue, partly offset by about £0.7 billion in higher working-age benefit claims (
OBR, box, subject to change). Individual state pension age depends on date of birth and can be checked on
gov.uk.
A further increase to 68 is set out in legislation for later decades and is kept under periodic review, so the timetable can change (gov.uk, as at July 2026). Because the qualifying age depends on your date of birth, many people choose to check their own state pension age and forecast directly on gov.uk rather than rely on a single headline figure.
What the numbers mean
Read together, the figures describe a state pension that is affordable now but under steady upward pressure: about 5% of GDP today, projected at 7.7% by the early 2070s, with the triple lock alone adding an estimated £15.5 billion a year by 2029-30 (OBR FRS, July 2025, subject to change). The analysis below is our own reading and is general commentary, not advice.
In our view three points stand out. First, the growth is gradual rather than sudden, which is why policy has tended to lean on slow-acting levers such as the state pension age rather than abrupt changes to entitlement. Second, the OBR frames the triple lock as a source of asymmetric risk: when inflation or earnings spike, the pension ratchets up and does not fall back, so persistent volatility could add a further 1.5% of GDP (about £43 billion in 2024-25 terms) by the early 2070s (OBR FRS, July 2025, subject to change). Third, these are projections built on assumptions about longevity, migration and productivity, so the further out they run, the wider the range of plausible outcomes. None of this tells any individual what their own pension will be worth; it describes the system, not a personal forecast.
Projections describe the size of the promise, not any one person's entitlement. What a given household receives still depends on National Insurance record, date of birth and future policy.
What this means for retirement and estate planning
The state pension is a foundation of retirement income rather than a complete plan, and the average award was around £9,720 in 2023-24 (OBR, pensioner benefits, subject to change). Because it is modest relative to many households' needs, private pensions, savings and property often carry much of the load, which is where later-life and estate planning tend to overlap.
A few connections are worth noting in general terms. The state pension is taxable income but is not itself part of your estate for inheritance tax; private pension pots and other assets can be. Standard inheritance tax thresholds, the £325,000 nil-rate band and residence nil-rate band of up to £175,000, are frozen to the end of the 2030-31 tax year (5 April 2031) — a freeze extended by a further year at the Budget on 26 November 2025 — so more estates may fall within scope over time (gov.uk, Budget 2025, as at July 2026, subject to change). Many people choose to look at retirement income and estate plans together, and it can be worth discussing pensions with an FCA-authorised financial adviser. For background, see our estate planning guide, our overview of Inheritance Tax Explained, and the data on UK pension wealth.
Sources and methodology
Every statistic on this page comes from a named official source and was checked against the live publication in July 2026. Cost projections are the OBR's central estimates; figures expressed as a share of GDP follow the OBR's own presentation, which it treats as the most relevant measure of sustainability (OBR FRS, July 2025).
- OBR, Fiscal risks and sustainability, July 2025: spending of ~£138bn (~5% of GDP, 2024-25); 7.7% of GDP by the early 2070s; triple lock adding ~£15.5bn/yr by 2029-30. obr.uk
- OBR, Welfare spending: pensioner benefits: £125bn state pension cash spending and £9,720 average award (2023-24); 3.3%-3.7% of GDP in the two decades to 2007-08. obr.uk
- OBR, The fiscal impact of increases in the state pension age: pension age rising 66 to 67 between April 2026 and March 2028; ~£10.5bn net saving in 2029-30. obr.uk
- gov.uk, State Pension boost announcement, 4 April 2026: 4.8% uprating; full new State Pension £241.30/wk and basic £184.90/wk from 6 April 2026; over 12 million pensioners. gov.uk
- gov.uk, The new State Pension and State Pension age: current full rate and pension age rules. gov.uk/new-state-pension, gov.uk/state-pension-age
- ONS, Living longer, 2018-based projections (2019): 24%+ of the UK aged 65+ by 2042, up from 18% in 2016. ons.gov.uk
- gov.uk, Inheritance Tax: nil-rate band and residence nil-rate band, frozen to end of 2030-31 (5 April 2031), extended a further year at Budget 2025 (26 November 2025). gov.uk/inheritance-tax
Frequently asked questions
How much does the UK state pension cost?
State pension spending was around £138 billion in 2024-25, roughly 5% of GDP, making it the second-largest item in the UK budget after health (OBR, Fiscal risks and sustainability, July 2025, subject to change). In cash terms the OBR recorded £125 billion of state pension spending in 2023-24 (OBR, pensioner benefits).
What are the state pension cost projections for the UK?
In the OBR's central long-term projection, state pension spending rises from around 5% of GDP in 2024-25 to about 7.7% of GDP by the early 2070s (OBR, July 2025, subject to change). These are projections based on assumptions about ageing, earnings and inflation, so the actual path can differ, generally more so the further ahead the estimate runs.
How much does the triple lock cost?
The OBR estimates that uprating the state pension by the triple lock rather than by earnings will have added about £15.5 billion a year, roughly 0.5% of GDP, by 2029-30, around three times higher than initial expectations (OBR, Fiscal risks and sustainability, July 2025, subject to change). The OBR also notes the triple lock creates asymmetric exposure to inflation and earnings shocks.
How much is the state pension in 2026-27?
From 6 April 2026 the full new State Pension is £241.30 a week and the basic State Pension is £184.90 a week, following a 4.8% triple lock increase (gov.uk, 4 April 2026, subject to change). What an individual actually receives can depend on their National Insurance record, so many people check their own forecast on gov.uk.
When is the state pension age going up?
The state pension age is scheduled to rise from 66 to 67 for men and women between April 2026 and March 2028, with a further increase to 68 legislated for later decades and kept under review (gov.uk, as at July 2026, subject to change). Because the qualifying age depends on date of birth, it can be checked directly on gov.uk. Rules apply across Great Britain, with Northern Ireland broadly aligned.
Is the state pension part of my estate for inheritance tax?
The state pension is taxable income during your lifetime and stops on death, so it is not itself an asset in your estate for inheritance tax (gov.uk, as at July 2026). Private pensions and other assets may form part of the estate, depending on circumstances. The rules can be complex, so it can be worth discussing your position with a qualified professional.
About Fairchild Oldfield
Fairchild Oldfield are estate planning specialists and will writers based in England and Wales. We are not a firm of solicitors and do not provide reserved legal services or regulated financial advice.
This article is general information drawn from published official statistics, not legal, tax or financial advice, and does not create a professional relationship.
Important: This article is general information only and is not legal, tax or financial advice. Reading it does not create a professional relationship. It is based on the law and statistics of Great Britain, with the state pension administered UK-wide; other UK jurisdictions may differ on related matters. Figures and projections are as at July 2026 and are subject to change; long-term projections in particular carry significant uncertainty. Before acting, many people choose to seek advice from a suitably qualified professional, such as an FCA-authorised financial adviser, a solicitor, or an accountant, who can consider your individual circumstances.
