Pension triple lock to cost triple initial estimate
Summary
The state pension triple lock in the UK is expected to cost three times more than initially estimated by the end of the decade, according to the Office for Budget Responsibility (OBR). The triple lock ensures that state pensions rise by the highest of inflation, wage increase, or 2.5% each year. The OBR warns that rising costs and recent government decisions on spending and tax changes are putting the UK's public finances under strain.Key Facts
- The triple lock was introduced in 2011 to make sure the state pension keeps up with living costs and incomes.
- By 2030, the cost of the triple lock is expected to reach £15.5 billion a year.
- The triple lock has been more expensive due to fluctuating inflation and earnings, costing three times more than expected.
- Spending on state pensions has increased as more people reach pension age.
- The UK state pension budget is the second-largest after health spending.
- The OBR says recent government changes have made UK finances more vulnerable.
- The Institute for Fiscal Studies suggests removing the triple lock to link pension increases just to price rises.
- Pensioner groups argue that the triple lock helps protect older people from high living costs.
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