The coalition Government introduced the triple-lock pension in 2010 as a guarantee to increase the State Pension each year
The coalition Government introduced the triple-lock pension in 2010 as a guarantee to increase the State Pension each year
The Triple Lock could be scrapped for millions of state pensioners because the system is “not sustainable”. The coalition Government introduced the triple-lock pension in 2010 as a guarantee to increase the State Pension each year in line with inflation, average earnings or a minimum of 2.5% – whichever is higher.
Harry Fenner, entrepreneur and former CEO of Navana Property Group, said: “For years, the triple lock on pensions has been touted as sacrosanct, a promise no Government dares break.
“But with soaring inflation and a cost of living crisis strangling public finances, it’s clear the current system is no longer sustainable. The Labour Party ’s stubborn pledge to maintain the triple lock throughout this Parliament is dangerously out of touch.”
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He said that despite Labour assuring it will stick with the triple lock, ministers will “almost certainly be forced to reconsider”. He said: “A fairer, more sustainable system must link pension rises to average earnings growth alone. This balances protecting pensioners’ living standards with fiscal responsibility.
“Alternatively, a triple lock modified to cap increases during economic downturns could work.”
Gary Smith from Evelyn Partners said: “With an ageing UK population, the cost of the State Pension will continue to rise and represent a greater percentage of GDP in the future. Simply put, the country just can’t afford it.
“As the Chancellor faces the challenge of tightly controlling Government expenditure to reduce the Budget deficit, retaining the triple lock will be too much of a burden and result in tax rises in other areas to compensate.”
He said: “A shift to a double lock would see the removal of the minimum 2.5% annual increase, with future increases subject to average earnings or inflation. This would ultimately reduce the burden on the Treasury over the long term, if increases in average earnings and inflation remain below 2.5% moving forward.
“I suspect that we will see further changes to the State Pension in the future, with the timescale of increasing the State Pension age accelerated, as the Treasury seeks to manage the future costs of maintaining this benefit.
“With this in mind, I would encourage savers to consider how much they are saving towards their retirement, as the State Pension is unlikely to be as generous as it has been under the triple-lock regime, and the age from which it will become payable will no doubt increase.”