Tony Blair’s thinktank urges Labour to scrap ‘unaffordable’ pension triple lock
Summary
Tony Blair’s thinktank recommends that the Labour Party stop the pension triple lock policy because it is too expensive for government finances. The triple lock, which raises pensions each year based on inflation, wage growth, or 2.5%, is putting pressure on public spending as the UK faces inflation and an aging population.Key Facts
- The triple lock guarantees state pensions rise each April by the highest of inflation, average wage growth, or 2.5%.
- The policy was introduced in 2010 by George Osborne during the Conservative-Liberal Democrat coalition government.
- Rising inflation due to factors like the Middle East conflict and Covid pandemic has increased pension costs.
- The Tony Blair Institute says the triple lock is “unaffordable” due to the growing number of pensioners in the UK.
- The population of pensioners is expected to grow from 12.6 million now to nearly 19 million by 2070.
- Without change, pension spending could rise from 5% to 7.8% of the UK’s gross domestic product, adding £85 billion annually.
- The thinktank suggests a new “lifespan fund” that lets people save into a personal pension fund with flexible access.
- The Labour government has committed to keeping the triple lock for this parliament but faces calls for reform before the next election.
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