Burnham to call for triple lock review: what it means for your pension
Prime Minister Andy Burnham is expected to use his speech at Labour's conference on Tuesday to push for a review of the pensions triple lock. According to the Express, he will tell the party that the policy is not working in its current form and that Labour's next manifesto should promise to look at it again.
The Telegraph reports, citing senior Government sources, that he will stop short of promising to scrap the triple lock outright. For now the plan is a review, not an abolition. Millions of pensioners have good reason to watch closely what that review might lead to.
The triple lock has set the April rise in the State Pension since 2011. Each year the pension goes up by whichever of three measures is highest. The first is Consumer Price Index inflation. The second is average wage growth between May and July of the previous year. The third is a floor of 2.5%. That guarantee means pensioners always get at least a 2.5% rise, even in years when prices and wages barely move.
Anyone who has retired, or who expects to rely on the State Pension later in life, has a stake in this. Supporters credit the triple lock with rebuilding the value of the State Pension against both prices and earnings. Critics point to the rising cost of State Pension spending to the Government and question whether the system can be kept going over the long term.
The idea has split senior Labour figures. Sharon Graham, General Secretary of the Unite union, told The Times that a review would be close to electoral suicide and that she did not believe it was morally right. Darren Jones, who left the Cabinet when Mr Burnham became Prime Minister earlier this year, took a different view. He told the BBC the triple lock would be very expensive in the years ahead and suggested money could instead be moved towards social care for older people.
On timing, Defence Secretary Wes Streeting said the triple lock will stay in place until at least the next election, because Labour is sticking to its 2024 manifesto pledges. He would not say whether it would appear in the party's next manifesto. That means the guarantee looks safe for now, but its future after the next election is uncertain.
Pension experts want clarity. Charlotte Kennedy, a chartered financial planner at Rathbones, said people need a clearer picture of where retirement policy is heading so they can plan with confidence. Maike Currie of PensionBee said the triple lock was designed as a catch-up measure rather than a permanent one, but warned that any change must be signalled well in advance because people plan their retirement decades ahead.
For ordinary households the message is simple. Nothing changes to next April's rise because of this speech, and the lock is promised until the next election. After that, the rules that decide how much your pension goes up each year could be reopened. Anyone planning their retirement income should keep a close eye on what Labour puts in its next manifesto.
