Will the state pension be means-tested? DWP gives update after months of 'speculation and rumour'

Sandra Wrench, a former Department for Work and Pensions (DWP) employee with over 42 years of experience, expressed her worries about the prospect of means-testing the state pension with a written nine-page letter to the DWP in July.

Wrench from Bedford submitted the letter to her local MP, Mohammad Yasin, explaining why the UK Government would face “great difficulty” implementing such a massive policy change due to the complexity of the contributory benefit.

Responding to the ex-DWP employee’s concerns last month, Emma Reynolds, the Pensions Minister confirmed that the UK Government “have no plans” to means-test the state pension.

Many older people rely on the state pension as their primary source of income.

In her response, Reynolds wrote: "I am sorry that speculation and rumour has caused Wrench undue concern.

"Ensuring a better deal for current and future pensioners is a priority for this Government."

The minister added: "I can confirm that the state pension is not subject to a means-test, and we have no plans to change this."

The reassurance from Reynolds follows a period of growing speculation about potential changes to pension policies, partly fuelled by the Labour Government's recent announcement regarding Winter Fuel Payments.

Over 10 million older people not receiving income-related benefits will no longer qualify for these payments of up to £300.

Wrench highlighted the challenges of claiming means-tested benefits for older individuals.

The 72-year-old said: "You need some kind of financial security in later life, so having a state pension which is not means-tested gives people that security, which is why I feel that it is such an important issue."

"It is easy for some people to say that you can claim a means-tested benefit, such as Pension Credit, but as you get older you may not have the mental energy levels to cope with completing a 23-page form, including listing all your assets, and notifying DWP of any change."

In a boost for pensioners, Reeves has confirmed that state pension payments will rise by 4.1 per cent from next April, in line with the earnings growth measure of the Triple Lock policy.

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This increase will benefit millions of older people claiming both the new and basic state pension. Those on the full new state pension could receive an uplift of up to £470 over the 2025/26 financial year.

To get the full new state pension, Britons will need 35 years worth of NICs, for the old state pension, one would need 30 years worth of NICs and for any state pension at all, Britons need at least 10 years worth of NICs.

However, it's important to note that additional state pension elements will increase by the September CPI figure of 1.7 per cent.

These changes come alongside the previously announced modifications to Winter Fuel Payments, which will now be means-tested. Additionally, Reeves announced that the Pension Credit earnings threshold will increase from £11,400 to £11,850 in April.