The Department for Work and Pensions has set out more detail on plans to change the State Pension Triple Lock from 2030, saying pensioners will continue to be protected from rising prices while the system is made sustainable for future generations.
Current system until April 2030
The Government has confirmed that the existing Triple Lock will remain in place until April 2030. Under the current system, the Basic State Pension and New State Pension rise each year by whichever is highest of average earnings growth, CPI inflation or 2.5%.
From April 2030, however, the Government is proposing an adjusted system.
New earnings link from 2030
On X, the DWP's new graphic explains that, from 2030, the State Pension will "always increase by at least the highest of 2.5%, CPI inflation or a new earnings link".
The key change is the introduction of the new earnings link. The new earnings link is expected to save money because the State Pension will no longer automatically rise by whichever of earnings, inflation or 2.5% is highest every year.
Pensioners will not see their State Pension cut, but the Government expects the slower long-term growth to reduce spending by billions compared with keeping the current Triple Lock.
Protection and sustainability
This means pensioners would remain protected if prices rise sharply, while also continuing to share in increases in wages over time. The Government says the State Pension will therefore rise in line with average earnings over the longer term.
One of the DWP infographics specifically states that pensioners will "continue to share in the growth of the economy and be protected from price rises". Another says the proposed settlement is intended to protect both current pensioners and those who will retire in the future, describing the State Pension system as one that needs to be "built to last".
The Government has also linked the change to wider plans for a National Care Service. It estimates that adjusting the Triple Lock could reduce State Pension spending by around £15 billion a year by the end of the 2030s, rising to around £50 billion a year by 2050.
