Britain is at a fiscal crossroads, and one of the greatest risks to the nation’s financial health is hiding in plain sight: the triple lock on the State Pension.
On the surface, it sounds fair and even compassionate. Each year, pensions must rise by the highest of inflation, average earnings growth, or 2.5 per cent. The idea is that pensioners should never fall behind. But built into that guarantee is a fundamental flaw: you cannot continue to increase a benefit faster than the growth of the revenue that funds it.
This week, that flaw came into sharper focus. The government has confirmed that the State Pension will rise by 4.7 per cent in April 2026, the figure pegged to average earnings. It is a big win for pensioners, but not without consequences.
Just last year, a similar jump added an estimated £6.9 billion to the annual pension bill. That extra spending must be found from somewhere – whether through higher taxes, higher borrowing, or cuts to other services.
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The triple lock has already cost far more than was ever predicted. When first introduced, it was budgeted at a relatively modest premium.
Yet the Office for Budget Responsibility now forecasts that maintaining it will add more than £15.5 billion per year by 2029–30. The Resolution Foundation points out that this is nearly three times higher than the original estimates. In other words, the triple lock was sold as affordable but is proving anything but.
The underlying economics are stark. Pension spending is funded primarily by National Insurance, general taxation, and the wider economy’s capacity to produce wealth. If pensions are locked into rising faster than those revenue streams, the imbalance will only widen.
In France, the average income of pensioners has already overtaken that of working-age people. Britain is not far behind. With pensioners’ incomes protected by the triple lock while many workers face stagnant wages or insecure work, the intergenerational balance risks tipping into something unsustainable and unfair.
And yet, despite the mounting evidence, there is near silence in Westminster. Every major political party remains committed to the triple lock, treating it as untouchable. It is easy politics: no one wants to be accused of short-changing pensioners.
But by ducking the question, they are ignoring the consequences for the whole economy. Government debt already stands at around 94 per cent of GDP, and pension spending is projected to rise from five per cent of GDP today to nearly eight per cent in the 2070s. The triple lock alone accounts for more than half of that projected increase. If left unchecked, it risks crowding out everything else that government does.
The uncomfortable truth is that this debate cannot be postponed forever. Protecting pensioners is a noble goal, but noble goals cannot override fiscal reality. If the triple lock continues in its current form, the bill will land on the desks of younger taxpayers and future governments, who will have less to spend on everything from health to housing to education.
There are ways to reform it – smoothing out volatility, pegging increases to earnings or inflation but not both, or targeting support more at those who need it most. But until politicians are willing to say out loud that the triple lock is unsustainable, the country will keep sleepwalking toward a reckoning.
The principle is simple and inescapable: you cannot outpace what funds you. Britain needs an honest conversation about whether we can afford to keep raising pensions at this rate, or whether the triple lock is a promise we simply cannot keep without bankrupting ourselves.