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MPs call for ‘triple lock’ on UK pensions to be temporarily suspended

Decoupling state pension from wages in 2021 would help stretched public finances, says committee

THE government has had to admit that the triple lock – which stipulates that pensions must rise by the rate of inflation, average earnings or 2.5 per cent, whichever is greater – could lead to an 18 per cent increase in payments in 2022.

Mel Stride, the Conservative chair of the treasury select committee, said a way out of the pensions headache would be to suspend the link with wages in 2021.

The figures show that earnings will fall by more than 7 per cent this year because of people being furloughed but will increase again in 2021 when full-time work resumes.

Stride said a solution would be to increase pensions by either the rate of inflation or 2.5 per cent, but this would mean breaking a promise made in the 2019 Conservative party manifesto.

He added, “The chancellor needs to fix the lock by balancing the importance of protecting the income of older people, against the impact on the public finances.”

Groups representing pensioners have said the triple lock, which was introduced in 2010, is important because the UK state pension is ungenerous when compared with the financial support provided to older people in other developed countries.

 

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Written by

Mark T Connor

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