Andy Burnham, the Labour MP for Makerfield who is set to become Prime Minister on Monday, has announced plans to maintain the triple lock on the state pension, guaranteeing that basic state pensioners receive at least £758 a month. The policy will primarily benefit those born before 1953, meaning individuals aged 74 and over by April 2027.
Triple Lock Commitment
The triple lock, introduced in 2010 by the Conservative-led coalition government to combat pensioner poverty, ensures that the state pension increases every April by the highest of three measures: average earnings, inflation, or 2.5 per cent. By maintaining this pledge, weekly payments would rise by £4.60 to £189.50, equating to £758 per month.
Expert Reaction
Steven Cameron, Pensions Director at Aegon, commented: “Recent comments from Burnham, reaffirming he, if Prime Minister, would retain support for the triple lock, may provide short-term reassurance to today’s pensioners. But what’s needed from all major political party leaders is a longer-term vision for how the State Pension can remain fair, affordable, and sustainable not for the next three years but for the next 30 years and beyond.”
Financial Sustainability Concerns
Cameron added: “What’s clear is that public finances are under huge and increasing pressure. There’s no magic pot of money sitting to pay for State Pensions – they’re paid for by today’s workers on a ‘pay as you go’ basis. With an ageing population and fewer workers supporting more pensioners, the current system is already creaking at the seams and without reform, the triple lock will place an unprecedented burden on working-age taxpayers, raising serious questions around intergenerational fairness.”
OECD Recommendations
The Organisation for Economic Co-operation and Development (OECD) has called on the Labour Party Government to rethink its commitment to the triple lock, warning that the policy is becoming increasingly costly as the population ages. In a new report, the OECD suggested that changing the way annual State Pension increases are calculated could save around £60 billion over the long term.
