In April 2026, the Government said it was increasing pensioners’ incomes “faster than prices” by 4.8%. Assessing claims like this requires evidence about the costs faced by pensioners.
The latest Household Costs Indices (HCIs), published on 28 August, shows us that State Pension rates did in fact rise faster than cost inflation for the average retired household, 2.5% in June 2026, compared with 2.9% for non-retired households.
Looking over a longer period shows variation between which household types experience more inflation. During the energy crisis, pensioner inflation reached 14.3% compared to 12.1% for non-retired households. Energy and food accounted for higher inflation because they make up a larger share of pensioner spending. Since July 2023 energy prices have fallen, and rents, mortgage interest, and transport costs have inflated more quickly.
Although the latest comparison is reassuring for pensioners, the average increase conceals variation in experience. Housing tenure, income, and energy needs all affect the cost inflation experienced by individual pensioners.
The HCIs could play a role in assessing State Pension uprating decisions. The inflation component of the triple lock uses CPI, which measures inflation across the population rather than pensioner costs. Replacing CPI with retired-household inflation would not necessarily always benefit pensioners. When their inflation was lower, as it is now, it could result in a smaller State Pension increase.
HCIs should still be considered alongside CPI in order to show whether uprating has protected pensioner standards of living. Their value lies in understanding pensioner inflation and showing when and why pensioners’ experience differs from the headline rate.
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