If Tories scrap triple lock the state pension age is next

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Millions of pensioners haven’t forgiven former Chancellor Rishi Sunak for his decision to suspend the triple lock mechanism in the wake of the pandemic. That move is costing them up to £480 a year in lost income.

Suspending it once was bad enough, doing it a second time will spark outrage as inflation rockets.

The triple lock increases the state pension each year either by earnings, inflation or 2.5 percent, whichever is highest.

If the government does stand by the triple lock, pensioners will be on course for a 10.1 percent pay rise from next April.

That is based on the inflation figure for September, which was published this morning.

Yet now it looks like pensioners will only get half that amount, as the Government looks set to use the earnings figure instead.

That will give pensioners a pay rise of 5.5 percent, roughly half inflation.

The controversial move could cost pensioners £442 a year in lost income.

Pensioners are a core constituency for the Conservatives, but now the party risks infuriating them again.

Suspending the triple lock mechanism is estimated to save the government a much-needed £5billion.

That is not a one-off saving – it will reduce the state pension by the same amount every year in future.

The state pension already costs the nation more than £100 billion a year, roughly 12 percent of all spending. That makes it a juicy target.

Newly appointed Chancellor Jeremy Hunt’s U-turns will save the HM Treasury £32billion a year, but that’s not enough.

He still has to find another £40billion of savings to balance the books.

Nothing is off the table, including increasing the age at which people can draw their state pension. This is already being explored under the Cridland review.

Currently, the retirement age is 66, but this is due to rise to 67 between 2026 and 2028.

The state pension age is reviewed every six years to ensure the costs of rising life expectancy are shared fairly between the generations, and to provide greater clarity over the retirement age.

Currently, it is legislated to rise to 68 between 2044 and 2046, but Ministers are already considering bring that timetable forward to between 2037 and 2039.

Hunt’s warning that he will have to make “decisions of eye-watering difficulty” suggests they will act.

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The decision will not be announced until next May, but as the government scrambles to save every penny Ministers may feel they have no choice but to make millions work even later in life.

Increasing the state pension age would cause less political damage than scrapping the triple lock.

That’s because the people affected would not feel the impact for another 15 years. By contrast, axing the triple lock will hurt from next April.

Pensioners will have that fresh in their minds when they go to the polls in 2024 or possibly even before then.

Bringing forward the retirement age increase is bad news for everyone, not just today’s pensioners but those who retire in future.

They will get less pension and also wait longer to receive it.

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