Burnham ends triple lock from 2030: how your state pension will rise

Prime Minister Andy Burnham has used his Labour conference speech to confirm that the pensions triple lock would be scrapped after the next election, with the savings going towards a new National Care Service. Under the plan, from April 2030 the state pension would still go up every year by inflation or 2.5%, but the link to wage growth would be dropped.

That wage link is the part pensioners stand to lose. It is the element that has pushed up the state pension in years when pay rose faster than prices. Anyone already drawing the state pension, and anyone expecting to claim it after 2030, would be affected. Nothing changes before April 2030, according to the plans set out in the speech.

The sums involved are large. Officials believe the change will save £15 billion a year by 2040 compared with keeping the triple lock as it is. In plain terms, that money comes out of the future rises pensioners would otherwise have received.

In return, Mr Burnham promised a care system he compared in scale to the creation of the NHS. He said it would be free at the point of use, that everyone would contribute and everyone would be covered, and that no care charges would be taken from the basic state pension. He also said it would protect people's homes and savings and deliver more care for older people in their own homes, which he argued was the only way to stop the NHS from collapsing.

Mr Burnham did not pretend it would be popular. "I accept I may pay a political price, but someone has to go through the pain barrier and rip the plaster off," he told delegates. He said he was ready to do things his predecessors would not.

Reaction was mixed. Caroline Abrahams of Age UK said a free care system would be transformational for older and disabled people, but urged the Government to have "a cast-iron plan to ensure no-one is left behind" as the triple lock changes. Helen Miller, director of the Institute for Fiscal Studies, called it the first genuinely difficult decision the government had taken and said pensions would still rise, just less unpredictably. Labour's Treasury Committee chair Meg Hillier praised him for saying it openly rather than sneaking it out.

The speech also promised a strengthened Water Bill to lift the 1989 ban on public ownership of water companies, and a national commission to look at replacing the first-past-the-post voting system, with proposals going into Labour's next manifesto.

What happens next matters. The detail of the care service is still being worked through by Louise Casey's independent commission, and the Prime Minister now needs to build political support for the triple lock change. So far, pensioners have been told what they give up and roughly when, but not exactly what the new care service will look like or when it will start.

For ordinary households, the deal is simple to describe and harder to judge. Smaller guaranteed pension rises from 2030 in exchange for a promise of free care later in life. Whether that is a fair swap depends on details the Government has not yet published.