The Cosmic Watchdog

A former pensions minister has sounded the alarm over the state pension triple lock, conceding that it’s “not perfect”. The mechanism ensures that the State Pension increases each tax year by either the Consumer Prices Index (CPI) rate of inflation, the average rise in wages from May to June the previous year, or 2.5 per cent, whichever is highest.

Sir Steve Webb, who was responsible for implementing the triple lock in 2010, cautioned that the policy might be swapped out for a less advantageous system for pensioners. The sustainability of the triple lock has been questioned anew, with Tory leader Kemi Badenoch hinting at a means-tested approach and Shadow Chancellor Mel Stride last month branding the policy “unsustainable”.

Labour’s new pension Minister, Torsten Bell, had also advocated for ditching the scheme in 2020 while a part of The Resolution Foundation think tank. The triple lock has previously been criticised for its costliness and the growing financial strain it could impose due to the UK’s aging population and broader economic challenges. Critics argue that it unfairly burdens younger taxpayers.

Sir Steve has conceded that the triple lock is not an ideal method for increasing the State Pension, but he emphasised that it “does a job”. In a conversation with The Telegraph, he forecasted that the triple lock would not “last forever” as it would eventually rise at a rate higher than prices and earnings.

He suggested that a future target would need to be established for any increases in the State Pension, thereby moving away from the formulaic nature of the Triple Lock. However, he expressed regret over the challenging “politics” surrounding the issue, stating that “no one wants to be the one who switches it off”.

Despite Sir Steve’s remarks, a spokesperson for Sir Keir Starmer recently confirmed that Labour remains “committed” to maintaining the Triple Lock, although there could be no assurance that it would stay in its present form for the remainder of the current Parliament.

State Pension payments 2025/26

Additional State Pension elements will increase by the September CPI figure of 1.7%.:

Full New State Pension

• Weekly payment: £230.25 (from £221..20)
• Four-weekly payment: £921 (from £884.80)
• Annual amount: £11,973 (from £11,502)

Full Basic State Pension

• Weekly payment: £176.45 (from £169.50)
• Four-weekly payment: £705.80 (from £678)
• Annual amount: £9,175 (from £8,814)