Rishi Sunak refuses to promise to keep the triple lock on pensions if the Tories win the next election as figures suggest it could add billions of pounds to the state’s bill for retirees
- Rishi Sunak refused to say he would keep the triple lock if he wins the election
- A report said the triple lock could add £45bn a year to the welfare bill by 2050
Rishi Sunak has refused to promise to keep the pensions triple lock if he wins the next election amid forecasts that it could add billions of pounds to the state’s bill for retirees.
Under the existing system, the state pension of £156 per week, or £203.85 for new retirees, is due to rise in April by the rate of wage growth, inflation or 2.5 per cent – whichever is the highest.
Spiralling inflation meant that the triple lock went up by 10.1 per cent in April.
The highest metric for next year’s rise is likely to be earnings figures, which when they are released on Tuesday are expected to show a rise of around 8 per cent.
Hiking the state pension by one percentage point equates to approximately £900 million of additional expenditure.
Rishi Sunak (pictured) refused to promise to keep the pensions triple lock if he wins the next election
The policy has been crucial for the Conservatives in securing the ‘silver vote’ since it was introduced by the coalition government in 2010.
But a report last week by the Institute for Fiscal Studies warned that if it is kept in place it could add as much as £45 billion a year to the welfare bill by 2050.
The think-tank said this would put ‘insurmountable pressure’ on the Government to increase the minimum retirement age.
Speaking at the G20 Summit in India, Mr Sunak would not vow to keep the lock. He said: ‘We’re not going to speculate on the election manifesto now. I’ve got plenty to get on with between now and then.
The triple lock is the Government’s policy and has been for a long time. I’m not going to get into our manifesto now but the triple lock has been a long-standing policy for us.’
That position appears to have changed since June, when Mel Stride, the Work and Pensions Secretary, said the Conservatives would ‘almost certainly’ commit to keeping it beyond the end of next year.
Mr Sunak is looking for savings to fund pre-election tax cuts, and has already hinted that the inflation link to benefits could be dropped by the Chancellor in his Autumn Statement.
It would represent a real-terms cut to working-age benefits if Jeremy Hunt decides not to peg them to September’s inflation figure.
Reports suggest Mr Hunt is considering lifting benefits by at least one percentage point below inflation or raising them in line with projected lower inflation figures for next year.
Rishi Sunak (pictured) during his New Delhi trip declined to ‘speculate’ about what would be in his Autumn statement
Mr Sunak, during his New Delhi trip, declined to ‘speculate’ about what would be in the Autumn Statement.
He said: ‘There is an annual statutory process, a legal process, that we work through every year to do benefits uprating and a whole host of other things.
‘But for people who are in that situation today, who I know are struggling with the cost of living, I just want to reassure them about the support that the Government is putting in place.’
Sir Keir Starmer has previously said benefits should go up in line with inflation.
Ministers have said they will decide after the next general election when to raise the state pension age to 68.
The current retirement age is 66 and will rise to 67 in 2028. The next scheduled rise to 68 is due in 2046, but there has been speculation this could be brought forward by more than a decade.
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