The state pension age could rise to 68 even sooner than originally planned to pay for the triple lock, ex-ministers have warned.
Former Tory MP, now a Tory peer and president of the Resolution Foundation think-tank, Lord Willetts told the i newspaper that “precedent and evidence so far” could likely lead to faster rises in the pension age. Currently, you can claim your state pension from aged 66 and the Government has already planned to increase this to 67 between 2026 and 2028. A further increase to 68 is also scheduled between 2044 and 48.
With the triple lock promise, Lord Willetts said it was "possible that the further increase could be sped up”. It comes as Prime Minister Rishi Sunak confirmed the triple lock would be in the Tory's upcoming election manifesto and would remain in place throughout the next Parliament if the Conservatives win. Due to these potential changes, people aged 47 to 48 expecting to retire in 2044 at 68 years could have to wait longer for their pension.
The triple lock was introduced by the Tory-Liberal Democrat coalition Government back in 2010 and it guarantees that the state pension rises every April by whichever is highest out of inflation (using the previous September rate of Consumer Prices Index inflation), wages (average growth between May and July), or 2.5%.
However, over the last two years, state pensioners have received bumper pension rises of nearly 20% due to high inflation. This has seen the cost of state pensions rise by an estimated £11billion a year.
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Lord Willetts said the triple lock was “funded by the speeding up of the pension age” of 1950's born women - or the WASPI group - from 60 to 66 years. He noted that the promise had been made earlier than the changes, and how the Government would fund it was questioned.
Lord Willetts, who was a minister of state in the Department for Business, Innovation and Skills from 2010 to 2014, told the i: “The argument was, if we speed up the increase in the pension age, there will be fewer pensioners, and we’ll be able to pay them a higher pension. That was the trade-off on which the triple lock rested when it was first introduced, and it is a reminder that somehow or other these pledges have to be paid for, even with unpalatable measures like that which have come back and proved to be very controversial.”
David Gauke, a former work and pensions secretary who was in the Treasury in the early 2010s, said: “The triple lock proved to be more expensive in practice than was anticipated when the policy was first announced, just because of the way in which the economy operated after 2010.” He added: “Ultimately, governments are going to have to take into account the wider fiscal situation.”
Tory sources told the i that the Government had "no plans" to increase the pension age in the coming years but did not rule out raising it at some point in the future. Labour have also committed to the triple lock, but have not officially confirmed it would be in their manifesto.
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