The coalition has stood by its promise for those who have worked hard all their lives, Pensions Minister Steve Webb has said.
Mr Webb said the government would honour its "triple guarantee commitment" to increase the basic state pension by the greater of earnings, prices, or 2.5%.
In a statement to the Commons on the uprating of benefits on 6 December 2012, he told MPs the new weekly rate for a single person would be £110.15 in 2013, up by £2.70 a week.
"This means that the basic state pension is forecast to be almost 18% of average earnings, a higher share of average earnings than at any time in the last 20 years."
Labour welcomed increases to the state pension but derided the chancellor's autumn statement, delivered the day before, as a "budget for unemployment".
Chancellor George Osborne announced that most working age benefits, such as Jobseekers Allowance and child benefit, will go up by 1%, less than the rate of inflation, for the next three years.
Mr Webb said: "Even in the face of a challenging economic situation and the need to find savings to rebalance our economy, we have still managed to provide a 1% increase to help support those not in work."
But shadow work and pensions secretary Liam Byrne claimed the bulk of the cuts would affect working households.
"The entirety of the balance is from tax credits, maternity allowance, maternity pay, sick pay, housing benefits - all of which of course are claimed by working people.
"These are the strivers and battlers the prime minister promised to defend at this party conference and they are the people paying the price for this government's failure."
Mr Webb challenged Mr Byrne to say whether Labour would support the changes or vote against them.
"We get a lot of fury and a lot of sound, but when it comes to the crunch he goes and abstains," the minister said.