Will scrapping triple lock hit retirement incomes?

THE Tories will scrap the ‘triple lock’ on pensions after 2020 – threatening the retirement incomes of millions.

David Cameron went into two elections promising to increase the state pension by the same rate as inflation, earnings growth or 2.5 per cent – whichever is highest.

But the 2017 manifesto said this would be replaced by a ‘double lock’ which only guarantees rises pegged to inflation and earnings.

It follows mounting calls to scrap the old promise amid concerns over cost pressures at a time when younger people were facing cuts.

However, some experts said the change will make little difference over the short term, because inflation has exceeded 2.5 per cent and is likely to stay that way for a while.

The Institute for Fiscal Studies said moving to a double lock ‘does little to resolve the pressures an ageing population will put on the public finances over the years to come’.

The IFS said: ‘The fundamental reason for this is that it is pretty rare for both average earnings and inflation to be below 2.5 per cent.

‘Hence getting rid of the 2.5 per cent element of the triple lock does little to change the projected longrun generosity of the state pension.’ But Frances O’Grady, general secretary of the Trades Union Congress, said: ‘The Conservatives have made the wrong political choice.

‘The UK has more than 1.5million pensioners in poverty, and one of the lowest state pensions in the advanced world. The triple lock was meant to restore the state pension after it spent decades falling behind wages. That job isn’t finished.’ Former pensions minister Sir Steve Webb said: ‘The problem with switching off the triple lock for all pensioners is that there are many older pensioners who are by no means well off.’

The manifesto also said the party would ensure the state pension age reflects increases in life expectancy.

But there was nothing to help the so-called WASPI women who had to wait longer than expected for their pensions.

Jane Cowley, director of the WASPI – Women Against State Pension Inequality – campaign, said: ‘We are very disappointed that the Conservative Party has chosen to ignore the voices of 3.5million women who have lost out, unfairly, because of pension changes unreasonably introduced by successive governments.’