Retirement ‘only for over-70s if pensions stay triple-locked’

“TRIPLE-locked” state pensions must be abandoned unless retirement age is raised above 70, MPs are warning.

The triple lock ensures state pension incomes rise with whichever is highest of prices, earnings or 2.5 per cent.

Keeping it beyond 2020 will effectively add at least 18 months to the state pension age of younger workers, calculations by the Institute for Fiscal Studies say, putting millions more people at risk of dying without ever collecting a state pension.

By scrapping this protection and instead pegging state pension incomes to average earnings beyond 2020, pensions could be paid out at the same level to people from the age of 67 and a half in 2060, the IFS calculated.

Keeping the triple lock in place would mean state pensions could only be paid out to people aged 70 and a half, if costs were to remain the same.

Raising the state pension age above 70 would see millions more die before receiving a penny of pension, as more than one in 10 people currently aged 25 are expected to die before they hit 70.

MPs on the work and pensions select committee are now calling for the triple lock to be scrapped after 2020. Today a motion to approve an extra £2.1billion of spending by the Department of Work and Pensions in the current year will be debated in the Commons in response to the committee’s “inter-generational fairness” inquiry.

Launched last year, it looked into whether Government policies such as the triple lock are contributing towards the growing disparity in wealth between the generations.

Frank Field, the committee’s chairman, said: “With the triple lock, the only way expenditure can be made sustainable is to keep raising the pension age. This has the effect of excluding ever more people from the state pension. Such people will disproportionately be from more deprived areas.”