Chancellor Rishi Sunak has signalled that the triple lock on pensions could be broken amid concerns state pensions may rise by 8 per cent because of the coronavirus pandemic.
He said concerns surrounding the large and costly rise are “completely legitimate” and that any decision will be fair for “pensioners and for taxpayers”.
The Office for Budget Responsibility (OBR) predicted a rise of up to 8 per cent from April next year, which could cost an extra £3 billion in Government spending.
Mr Sunak declined to rule out an alteration to the Conservative manifesto pledge to maintain the triple lock on pensions, instead only noting that it is policy at the moment.
“The triple lock is the Government’s policy but I very much recognise people’s concerns,” he told BBC Breakfast.
“I think they are completely legitimate and fair concerns to raise.
“We want to make sure the decisions we make and the systems we have are fair, both for pensioners and for taxpayers.”
Mr Sunak said the Government must “wait for the actual numbers to be finalised”, which he said are currently “speculation”, before looking at the policy “properly at the appropriate time”.
The triple lock guarantees that the state pension increases in line with inflation, earnings or 2.5 per cent – whichever is higher.
But unusually strong recent rises in earnings as a result of the pandemic mean the payout is expected to sharply increase.
This is as a result of artificially high earnings growth when comparing with a year ago when wages were depressed while many workers were furloughed.
Many jobs lost have also been lower-paid roles.
Related: ‘The history boys’: Newspapers react to famous England victory
Since you are here
Since you are here, we wanted to ask for your help.
Journalism in Britain is under threat. The government is becoming increasingly authoritarian and our media is run by a handful of billionaires, most of whom reside overseas and all of them have strong political allegiances and financial motivations.
Our mission is to hold the powerful to account. It is vital that free media is allowed to exist to expose hypocrisy, corruption, wrongdoing and abuse of power. But we can't do it without you.
If you can afford to contribute a small donation to the site it will help us to continue our work in the best interests of the public. We only ask you to donate what you can afford, with an option to cancel your subscription at any point.
To donate or subscribe to The London Economic, click here.
The TLE shop is also now open, with all profits going to supporting our work.
The shop can be found here.
You can also SUBSCRIBE TO OUR NEWSLETTER .
