DWP state pension triple lock in doubt as experts call for sustainable alternatives
The triple lock has been in the spotlight in recent years as it has led to eye-watering increases in the state pension - but there are fears such rises could become a thing of the past
by Nicholas Dawson · ChronicleLiveThe future of the state pension's triple lock appears uncertain with government ministers pondering a shift to a "more sustainable" method to calculate its annual increase. The policy has recently resulted in substantial hikes in payments – an 8.5 percent rise this April following a record 10.1 percent increase last year.
However, industry specialists are signalling that such sizeable boosts may not continue. Fiona Peake, a pensions authority at Ocean Finance, voiced concerns about the policy's viability: "It is becoming increasingly expensive."
She highlighted the importance of the triple lock for pensioners but also flagged the affordability struggles, stating, "While the triple lock plays an important role in supporting retirees, there are questions about its long-term affordability."
Peake also presented a potential solution which could lessen financial strain without elevating the state pension age: "One possible solution to ease pressure without raising the state pension age could be to adjust or even scrap the triple lock with a more sustainable policy.", reports the Express.
Get all the latest money news and budgeting tips from Chronicle Live with our free newsletter
She cautioned, though, that any reduction in pension benefits needs careful consideration as it could hit those dependent on the state pension for their main income source the hardest.
Echoing these sentiments, Chris Ball, managing partner at Hoxton Wealth, remarked on the challenges facing the government: "Keeping this promise while balancing an ageing population and rising costs may become more difficult for the Government."
He pondered the changing nature of the triple lock, suggesting: "It's conceivable that the triple lock could be adjusted as part of an effort to keep the state pension affordable without having to raise the state pension age too steeply."
Mr Ball proposed an alternative solution for the Government's consideration. He stated: "A potential compromise could involve changing the triple lock formula-perhaps by using a less generous metric or adjusting it during years of significant economic strain."
"Such a change would require careful political handling, as pensioners rely on the triple lock to ensure their income keeps up with the cost of living."
Currently, the full new state pension pays £221.20 a week, while the full basic state pension is £169.50 a week.
Typically, 35 years of National Insurance contributions are needed to receive the full new state pension, and 30 years of contributions are required for the full basic state pension. The current age for claiming the state pension is 66, although legislation is in place to increase this to 67 and then 68 over the coming years.
Join our WhatsApp communities
ChronicleLive is now on WhatsApp and we want you to join our communities.
We have a number of communities to join, so you can choose which one you want to be part of and we'll send you the latest news direct to your phone. You could even join them all!
To join you need to have WhatsApp on your device. All you need to do is choose which community you want to join, click on the link and press 'join community'.
No one will be able to see who is signed up and no one can send messages except the ChronicleLive team.
We also treat our community members to special offers, promotions, and adverts from us and our partners.
If you don't like our community, you can check out any time you like. To leave our community click on the name at the top of your screen and choose 'exit group'.
If you’re curious, you can read our privacy notice.
Join the ChronicleLive Breaking News and Top Stories community
Join our Court & Crime community
Join the Things to do in Newcastle and the North East community
Join our Northumberland community
Join our County Durham community
Join our Great North Run community