Interactive Investor

Door open for triple lock to be scrapped for good

16th November 2021 08:55

Rebecca O'Connor from interactive investor

Our head of pensions and savings sounds a warning for pensioners.

Becky O’Connor, Head of Pensions and Savings, interactive investor, says: “The government refused to budge on its decision to scrap the earnings element of the state pension triple lock, despite a proposed amendment from the House of Lords that could have solved the problem of this year’s higher earnings figure causing an artificially high increase in April next year.

“It’s disappointing for pensioners that the Treasury could not find an alternative that would better protect pensioner incomes against inflation than the measure being used this year - September’s inflation rate of 3.1%, as this now looks to be on the low side given sharply rising energy, food and fuel bills. There is a real risk that some pensioners will struggle to stay warm and well fed this winter.

“But the longer-term threat is that the door is now open for the state pension triple lock to be scrapped for good. This is worrying. The government says it will reinstate the triple lock after a year - but a lot can happen in a year and the risk is that the government will renege on this promise. 

“For future generations of workers, who might one day depend on the state pension for the bulk of their retirement income, the chipping away of the triple lock is concerning.”

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