𝓤𝓷𝓲𝓽𝓮𝓭 𝓝𝓮𝔀𝓼

Why are so many claiming that abolishing the triple lock on the state retirement pension will yield big savings? It is not going to solve our debt crisis and pay for free social care for all.

They are never asked how much this will save. They rarely tell us what they will replace the triple lock with. If they did, we would soon see that tampering with the triple lock will yield few savings in the next few years and still leave the government struggling to manage its stretched finances.

I assume none of the pension cutters want to end an annual uprating of some sort. With high inflation, a low pension would soon become hopelessly too small.

Maybe they wish to remove the provision that in a down year with low inflation the pension should not go up by 2.5%.

Maybe they just want to update the pension in line with wages, or just with prices.

Any of these solutions will still leave most of the increases pensioners currently enjoy in place, greatly limiting the savings.

The Government Actuary has said that if we stopped the triple lock the savings might get to £2bn by 2030-31. If they just removed the 2.5% promise and wage and price and inflation stay as now or went up there would be no savings at all.

Why do those who want savings ignore the much larger sums to be had by less unpopular policies?

If the government stopped recruiting new civil servants and started to get back the public sector productivity lost since 2019 they could tackle a £50bn black hole in our accounts.

If they asked the Bank of England to rein in its forecast average losses of £20bn a year they could save more.

If they adopted the Conservative proposals for benefits reform they could reduce costs by £23bn.

If they delayed or deferred carbon capture and storage schemes they could save billions.

Some of these wannabe reformers seem unaware that the state pension is based on people’s contributions paid over a lifetime of work.

Everyone’s National Insurance Contributions are paid into the National Insurance Fund, which in turn pays the pensions.

The good news is the Fund has a large surplus at its 2026 Valuation, and is forecast to have a rising surplus for the next five years whilst paying out the pension with triple lock increases.

The Government would need to change the law to release the surplus for spending on other priorities. Those on state pensions see it as an entitlement based on what they have put in.

There are many better ways of cutting the excessive build of debt. Stopping the triple lock saves too little money at too big a political cost. That is why both Conservatives and Labour promised to keep it in the last election.