Andy Burnham has pledged Labour Triple Lock Pension Changes after the 2030 general election if he wins it. The plan would drop the automatic earnings link from the state pension formula and replace the triple lock with a double lock.
Under the current system, the state pension rises each year by inflation, earnings growth or 2.5%, whichever is highest. Next April, the full new state pension is due to rise by around £489 a year to around £13,068, using the 3.9% earnings increase from the three months to July rather than September’s 3.5% inflation rate.
Andy Burnham and Ros Altmann
Ros Altmann said, "Dropping the earnings link removes the most important part of the triple lock." She was responding to Burnham’s plan to remove the part of the formula that has done most to help state pensioners catch up with wages.
The triple lock was introduced in 2011 after the basic state pension had fallen behind earnings and many people were plunged into poverty. Burnham’s proposal would leave inflation and the 2.5% floor in place, but it would end the direct link to wage growth that has driven larger increases when pay rises run ahead of prices.
Under Burnham
Using the figures in the current comparison, pensioners would get the 3.5% inflation uplift instead of the earnings-linked rise. That would be worth roughly £50 a year less than the earnings-based increase now used in the calculation.
Over time, that lower starting point compounds. The article says pensioners would lose that £50 every year forever if the lower amount became the base for future rises, and they would also lose all future growth on that £50.
After the 2030 general election
Altmann also warned, "That’s worrying because it will be left to future politicians to decide when and how to act." Burnham describes the shift as an adjustment, but the comparison in the figures shows it would mean smaller annual increases for state pensioners than the current triple lock delivers when earnings are stronger than inflation.
The practical effect for a pensioner now is straightforward: the next April rise is set under the existing formula, while Burnham’s alternative would only come into play after the 2030 general election. The unresolved issue is how his replacement system would protect pension growth against wages without the earnings link that currently does that job.
