In a special chapter on pensions policy, the OECD\u2019s experts say the triple lock \u201cputs upward pressure on public expenditure and adds significant fiscal risks by exposing public finances to supply shocks, thus requiring a timely reform\u201d \u2013 though it warns that public support would have to be built for any change.<\/p>\n
Speaking at the launch of the report on Wednesday, Torsten Bell, the pensions minister, left room for Labour to ditch the policy but only after the next general election. \u201cThe government\u2019s manifesto commitment is to the triple lock throughout this parliament,\u201d he said. \u201cThat is going to happen.\u201d<\/p>\n
As Rachel Reeves<\/a> prepares to leave the Treasury after two years as chancellor, the OECD was broadly positive about her record, saying Labour\u2019s pro-growth agenda \u201cprovides a strong basis for a gradual recovery\u201d.<\/p>\n Launched at a press conference in London on Wednesday, the assessment came after Reeves used her final Mansion House speech in the City to defend the decisions she has made, saying she had \u201cproven the doubters wrong\u201d.<\/p>\n But its 140-page assessment repeatedly returns to the need to repair the public finances in the years ahead.<\/p>\n \u201cModest growth, high public debt, high interest payments and increasing spending pressures from ageing, climate and defence are limiting fiscal space,\u201d it says, adding that the plans pencilled in by Reeves at last year\u2019s spending review<\/a> \u201cleave limited room for manoeuvre\u201d.<\/p>\n \u2018The government\u2019s manifesto commitment is to the triple lock throughout this parliament,\u2019 said Torsten Bell, the pensions minister. Photograph: Linda Nylind\/The Guardian<\/p>\n Thinktanks including the Resolution Foundation and the Institute for Fiscal Studies have called for reforming the triple lock, which was introduced by the Conservative-Lib Dem coalition in 2010.<\/p>\n The independent Office for Budget Responsibility has also highlighted the triple lock as a risk to long-term fiscal sustainability, pointing out that it has cost three times as much as anticipated when introduced.<\/p>\n The OECD suggests the annual increase should instead be an average of earnings and inflation \u2013 an approach that it estimates could make savings worth 2% of GDP in the long term.<\/p>\n Other money-saving measures it recommends include a drive to improve the productivity of hospitals, with spending on this crucial part of the NHS high by international standards.<\/p>\n
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