More than 26 million people in the UK could be heading for a financial 'disaster' if the government abandons the state pension triple lock, a former Pensions Minister has starkly warned.
Sir Steve Webb, who served as Pensions Minister in the coalition government, has revealed shocking new analysis showing the profound risk to current workers' retirement prospects. The partner at pension consultants LCP stated that 26.1 million working-age individuals face substantial declines in their quality of life if the long-standing perk is removed.
The Triple Lock Under Threat
Sir Steve characterised the findings as 'shocking figures' that expose how the true scale of under-saving for retirement in Britain is far greater than previously acknowledged. He directly criticised the government's approach, noting, "Very few people expect the triple lock to continue for another fifty years, yet this is the basis on which the government has so far published estimates."
The central warning focuses on what would happen if the triple lock—which guarantees the state pension rises by the highest of inflation, average earnings, or 2.5%—is replaced. According to the analysis, the consequences would be severe for millions.
Millions Pushed Below Minimum Standard
The research highlights a dramatic increase in the number of Britons who would fail to meet even the minimum retirement living standard set by the Pensions and Lifetime Savings Association.
The key findings are:
- If the triple lock were replaced with a link to earnings only, an extra 1.4 million people would retire below the minimum threshold.
- A far worse outcome would occur if the pension were only linked to prices, a policy that was in place until 2010. This change would push more than 7 million additional pensioners below a basic standard of living.
- Approximately one in three of today's workers would be set to retire short of a bare minimum lifestyle under a prices link.
Sir Steve Webb stated, "If the triple lock were to be replaced by an earnings link, millions more people would face a sharp drop in their standard of living when they retire."
A Call for Budget Action
With the Chancellor's Budget statement scheduled for November 26, all eyes are on whether pension policy will be changed. Against this worrying backdrop, Sir Steve is urging the government to take decisive action to boost retirement saving, not undermine it.
He issued a direct plea, saying, "Against this backdrop, the Chancellor should be taking measures in the Budget to boost pension saving, not undermine it." The former minister's intervention raises the political stakes significantly ahead of the fiscal announcement, placing the financial security of millions of future retirees firmly on the agenda.
