Pressure continues to grow on the future of the triple lock but without it Harvey Jones explains how retirees would pay an unimaginably high price.
Being a pensioner can be hard. It would be a lot harder without the triple lock (Image: Getty)
On Monday, the state pension triple lock will give us a timely reminder of just how valuable it is.
From April 6, the mechanism will protect pensioners from today’s rising prices with a 4.8% pay rise. Yet its future remains under consant threat. Last week, Nigel Farage’s Reform Party pledged to back the mechanism, which increases the state pension each year by earnings, inflation or 2.5%, whichever is highest. But other parties remain lukewarm. Labour’s Pensions Minister Torsten Bell recently suggested it may not survive beyond this Parliament. The Conservatives once backed it, but under Kemi Badenoch support looks a little less certain. As the public finances deteriorate, calls to scrap it will only grow louder.
From Monday, April 6, the full new state pension will rise by 4.8% to £241.30 a week, or £12,547.60 a year. The basic state pension, paid to those who retired before April 6, 2016, will increase by the same percentage to £184.90 a week, or £9,614.80 a year. That’s notably lower, and a long-standing grievance. Many older pensioners receive top-ups through SERPS or the state second pension, though. Whatever people get, the state pension falls far short of what’s required.
A single pensioner needs £43,900 a year for a “comfortable” retirement, according to the PLSA Retirement Living Standards survey. A “moderate” living standard needs £31,700, while even a minimum standard requires £13,400. And that assumes no mortgage or rent. Anybody who relies purely on the state to fund their retirement is heading for disaster.
But it would be far worse without the triple lock. Scrapping it would hit harder than many realise. I’ve crunched the numbers, and the result is terrifying.
The triple lock has delivered a series of large increases in recent years, including 8.4% in April and a record 8.5% in 2024, due to inflation and earnings respectively. Before the triple lock, the state pension rose only in line with inflation. When it was introduced in 2011, the full basic state pension was just £102.15 a week, or £5,311.80 a year. If it had tracked inflation since, my workings suggest it would be worth just £153.05 a week from Monday. That’s £31.85 a week less than pensioners are getting.
Over the year, the losses really add up. Without the triple lock, the basic state pension would be £7,958.60. That’s £1,656.20 a year less income.
The new state pension was only introduced in 2016, which means it has been protected by the triple lock for a shorter period. Yet it has still been hugely valuable.
The new state pension was £155.65 a week in 2016. Had it risen only with inflation, it would climb to £216.42 on Monday. That’s a meagre £11,253.84 a year. Without the triple lock, the full new state pension would be worth £24.88 less every week, a loss of £1,293.76 a year.
Apologies for throwing all those numbers at you, but they prove a simple point. Pensioners would be significantly poorer if the triple lock didn’t exist. Millions already struggle to make ends meet in retirement. How would they survive if they were getting £25 or £30 a week less?
That’s how Britain would treat its pensioners if MPs axe the triple lock. Even with the mechanism, Britain has one of the lowest state pensions in the developed world. Scrap the triple lock and retirees will pay an unimaginably high price.