Campaigners have condemned the latest attack on the pensions triple lock, warning older Brits should not be made “scapegoats” for the country’s economic woes. Former Work and Pensions Secretary David Gauke, a vice-chairman of the Prosper UK group of liberal Conservatives, claims the anti-poverty measure is “unaffordable” in its present form and warns that total welfare spending is forecast to reach £406 billion by 2030-31.
This comes on the heels of attacks on the triple lock from Sir Tony Blair and the Left-leaning Resolution Foundation, as well as from Iceland boss and Labour cost of living tsar Lord Walker. The policy ensures the full state pension goes up each year by whichever is highest – 2.5%, inflation or average earnings.
Political Reactions and Defenses
The Express has campaigned for the retention of the triple lock and last month Conservative leader Kemi Badenoch told us it would be one of the policies on which she would fight the next election. But Mr Gauke, who also served as Chief Secretary to the Treasury, told the Express that “facing up to the triple lock issue” will help the Tories recover trust as a party of fiscal responsibility.
He said: “I don't think politicians should be making promises that they can't keep, and promising to keep the triple lock in place forever is something that simply isn't going to be able to be delivered. We're not going to be able to afford to do that.”
Prosper UK Report Findings
A new report from Prosper UK claims around £20.6 billion a year would be saved by 2050 if changes were made so the state pension is linked to earnings, although it would be “protected against inflation in lean years”. Mr Gauke said: “When we launched Prosper UK, we said we would be honest about the trade-offs and led by the evidence - the evidence here is hard to argue with.
“The triple lock is unaffordable. Over time, it adds to a pension bill that working-age taxpayers are left to fund and at some point that becomes untenable. A smoothed earnings link would keep pensioners' incomes rising broadly in line with everyone else's and protect them when prices climb. This is a fairer and more sustainable basis for increasing the state pension in the long term.”
Campaigners' Response
However, Dennis Reed of campaign group Silver Voices accused the “political establishment” of “ganging up to make pensioners the scapegoats for our economic woes”. He said: “Following hot on the heels of Tony Blair, Jeremy Hunt and the Resolution Foundation, these liberal Tories want to pick the pockets of poor pensioners rather than making more fundamental tax and spending reforms. The rise in the cost of pensions is mostly because we are all living longer, not because older people are living in the lap of luxury.”
He added: “How does the impoverishment of the older generations, with all the extra health costs involved, help economic growth?”
Caroline Abrahams of Age UK said: “Politicians and think tanks seem to be queuing up to call for the triple lock to be scrapped. They usually point to how much it could cost in 20 or 30 years’ time – and then say this means it should end right now. At Age UK we strongly disagree, because the triple lock continues to play a vital role in buoying up pensioner incomes, especially if you haven't got much money coming in.”
Reform UK’s Robert Jenrick said: “Pensioners paid into the system for decades and helped keep this country going. That’s why Reform UK will protect their pensions and ensure they are looked after. We will get the public finances under control, but never by targeting those who have worked hard all their lives. Instead, we will cut wasteful spending – including by stopping the eye-watering cost of ‘Boriswave’ migrants – so pensioners can live with dignity in retirement.”
Morgan Vine, of Independent Age, said: “Everyone should be able to afford to live well when they reach older age, yet currently almost one in six older single people (16%) survive on just the state pension and social security entitlements, and many others in later life have very little more than this. For people in this situation, the triple lock provides a small but vital increase to their low incomes, and it needs to remain in place until a better alternative is put forward which will protect current and future pensioners.”
Further Welfare Reforms Proposed
Further measures proposed by Prosper to bring down the benefits bill include saving around £7.4 billion a year by “tightening and extending Universal Credit health-related reforms to existing claimants”. Mr Gauke said: “Having run the Department for Work and Pensions, I know reform on this scale is difficult and that the temptation in government is always to postpone it.
“But the numbers no longer allow for delay. Welfare spending is heading towards £406 billion a year by the end of the decade, and a system on that trajectory is neither fair to taxpayers nor sustainable for those who depend on it.”
