A senior adviser to Sir Keir Starmer has called for the state pension triple lock to be scrapped, branding the popular policy 'profoundly unfair'. Lord Walker, Labour's cost of living champion and executive chairman of Iceland, urged ministers to have the courage to abandon the guarantee, which increases the state pension each year by whichever is highest of inflation, average earnings growth, or 2.5%.
Speaking in the House of Lords, Lord Walker said: 'We should have the courage to challenge the pensions triple lock – mathematically unsustainable, politically untouchable and profoundly unfair. We all know it.' His comments pile pressure on the Government over the long-term future of a policy that Labour promised to maintain throughout this Parliament.
Before the 2024 General Election, Sir Keir pledged to keep the triple lock, arguing that pensioners deserved certainty after years of economic turbulence. The latest state pension increase came in April, when payments rose by 4.1% in line with earnings growth. However, the cost of maintaining the guarantee has become a growing concern for politicians and economists.
State pensions account for around 55% of all welfare spending, with the bill forecast to reach £178 billion this year. Lord Walker, who was appointed to the House of Lords by Sir Keir in January and named the Government's cost of living champion the following month, also warned that Britain's incentives to work were being eroded. 'We must urgently reform the welfare system, so that the safety net catches those who need it, not those who choose it as a lifestyle,' he said.
In a further swipe at the Government's economic performance, Lord Walker said growth had been slower than he expected since Labour took office. 'The bottom line is this: we will only cure the problem by growing the economy. It really is that simple. Yet I have to profess that growth has been slower than I imagined. It is only business that creates wealth, jobs and pays tax. I repeat – it is only business that can grow the economy.'
The triple lock has become one of the most politically sensitive issues in Westminster because of the millions of voters who benefit from it. Criticism of the policy has been mounting. Former Conservative Chancellor Jeremy Hunt said in April that pensioners might think differently about the triple lock if they realised it was being funded through rising national debt. Former Cabinet minister Michael Gove has argued that pensions should be linked to either wages or inflation, rather than whichever measure delivers the biggest increase. Even Nigel Farage has previously described the policy as 'unaffordable', although Reform UK has since pledged to keep the triple lock and instead cut welfare spending elsewhere to help fund it.
