Andy Burnham has set out changes that could impact all pensioners from 2030. Anyone born before 1964 would initially be affected. The Prime Minister is looking to modify the state pension triple lock, which could influence how much the rate increases annually.
The triple lock guarantees the state pension rises each year in line with whichever is highest out of inflation, wage growth or 2.5%. Burnham intends to scrap the earnings link, transforming it into a double lock, reports Birmingham Live.
What the proposed changes mean
Pensions would continue to increase annually under the proposed system, though not necessarily by as much as currently. The PM is seeking to release funds to bankroll a new free social care system.
As time goes on, this could result in retirees ending up with hundreds of pounds less as yearly rises decelerate. In recent years the pension has typically increased alongside wage growth.
Election uncertainty and political reaction
The alteration isn't finalised yet as there must be an election before 2030. And the matter is expected to spark heated debate as an election approaches.
Conservative leader Kemi Badenoch has indicated she would maintain the triple lock if her party secures victory at the next election. The Tories originally brought in the policy in 2012.
She said: "The triple lock is Conservative policy. We're not changing it." Badenoch stated: "If people want the triple lock they need to vote Conservative."
Although she did also tell Times Radio: “I have said that the triple lock is our policy and it remains our policy. I don’t think going after pensioners is the right thing when there are loads of people who can work, who won’t work.”
“When we are going to reverse Labour’s policies, I say we are going to reverse their policies. I have said that we are keeping this policy, but if they take that money and they spend it on something that we can’t get it back from, then it would be difficult for me.”
