State Pension UK: Rishi Sunak urged to scrap ‘unfair’ Triple Lock as amount rises

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The State Pension Triple Lock Mechanism means the amount the government hands to pensioners will increase each year. Under current rules, the uprating occurs based on the highest of three main components: average earnings growth, the rate of inflation or 2.5 percent. This tax year, the sum rose by 3.9 percent in line with average earnings growth.

And it has been announced today that the state pension sum will rise by 2.5 percent in the new tax year.

But with difficulty brought about by the COVID-19 crisis, a think tank has called for the measure to be ditched altogether.

The Centre for Policy Studies (CPS) has said the Triple Lock is creating a strain on the public purse, and that an alternative approach should be considered.

It comes as the think tank released its nine-point plan for helping the Treasury save money as Britain recovers from the financial impact of the pandemic.

The key proposal being put forward by the CPS is the replacement of the current Triple Lock policy.

In its place, it has said, a double lock could be implemented to still provide pensioners with some level of protection.

Additionally, under these plans, richer pensioners would have their Winter Fuel Payment reduced.

By implementing these two measures, the CPS has said, an annual saving of £2billion could be made. 

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Its report continued: “We must continue to preserve pensioners’ living standards, of course.

“But the Triple Lock has become an engine of unfairness, ensuring that pensioners’ incomes are always protected at the expense of other generations.”

The dual lock being proposed by the CPS would be based on average earnings or inflation.

It would therefore scrap the 2.5 percent guarantee, currently in place regardless of inflation or earnings. 

Alex Morton, Head of Policy at the CPS, commented on the matter.

He said: “Taxes are already at historic highs, and any further increases risk choking off any post-COVID recovery.

“The government must re-examine its existing spending and getting good value before considering raising tax further still.

“This package of savings is simultaneously radical but realistic – delivering better value for money for voters and allowing the government to continue funding its priorities.

“We strongly encourage the Chancellor and his team to explore our suggestions ahead of the spending review and Budget, and to identify any further savings that can be made.”

The state pension Triple Lock is a flagship manifesto policy of the Conservative Party.

The current government pledged to uphold the mechanism if they were elected in December 2019 – which occurred.

And in the face of criticism of the policy, government ministers and the Prime Minister have resisted calls for it to be scrapped.

Boris Johnson previously vowed to “meet all manifesto commitments”.

And it appears the announcement of the upcoming increase to state pension supports this notion. 

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