Pension experts have urged Prime Minister Andy Burnham to scrap the state pension triple lock, arguing that his planned social care reforms give him the perfect excuse to end the policy. The move could see new state pensioners lose out on an extra £313 a year, as the triple lock would have guaranteed a minimum 2.5% increase next year.
Writing in The Times, pensions commentator Tom Mcphail said: "Andy Burnham now has an excuse to end the state pension triple lock. The prime minister’s pledge to tackle social care will give him the ammunition to take on pensioners." Mcphail argues that Burnham, who has vowed to stick by the metric, should target the Department for Work and Pensions (DWP) mechanism, which dates back to 2011, as he prepares to reform the social care sector.
Triple Lock Costs and Savings
The triple lock guarantees that the state pension rises by the highest of inflation, average earnings, or 2.5%. Under this system, new state pensioners currently receiving £241 a week would see their payments rise by £6 a week, or £313 a year. However, Mcphail contends that the policy has become a "totemic fiscal bribe for the Baby Boomer generation" and that "no one can offer a rational argument as to why it still exists."
The policy, first introduced by the Conservative-Liberal Democrat coalition government, has already increased the cost of the state pension by around £12 billion a year compared to if it had risen in line with earnings alone. Forecasts suggest it could cost up to £45 billion a year by 2050, placing a significant burden on public finances.
Funding Social Care Reforms
With Burnham scrambling to find cash to fund his ambitious social care reforms, Mcphail suggests that scrapping the triple lock could provide the necessary funds. "Scrapping the triple lock and going back to an earnings link may be the least difficult way for him to find some of the cash he’ll need," he said.
The Prime Minister has previously vowed to stick by the triple lock, a commitment also made by former Chancellor Rachel Reeves. However, the growing cost of the policy and the pressing need for social care funding have led to renewed calls for its abolition. The decision now rests with Burnham, who must balance his pledge to pensioners with the financial demands of his social care agenda.
