Pensioners to lose £1,600 under Labour’s plans to scrap triple lock, new analysis shows
Labour plans to adjust the state pension’s triple lock from April 2030, a change that could leave future pensioners with less than under the current formula. Analysis by pensions adviser Hymans Robertson estimates the annual state pension could be £33,500 by 2050, rather than £35,100, a difference of £1,600.
The current triple lock raises pensions by whichever is highest: inflation, average earnings or 2.5 per cent. Labour’s proposed approach would remove average earnings as an automatic measure, while promising that pensions will retain their value relative to earnings over time and rise each year by at least inflation or 2.5 per cent. The government says savings will help fund social care, but Hymans Robertson says projected savings of around £50bn a year by 2049 could be halved if economic growth is low.
In short
- The state pension could be £1,600 lower a year by 2050.
- Labour plans to adjust the triple lock from 2030.
- Hymans Robertson says projected savings may be overstated.
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The case for
Revising the triple lock could make pension spending more sustainable as the number of pensioners grows, while freeing money for social care. Labour’s proposed safeguards—maintaining pensions’ value relative to earnings over time and ensuring annual rises of at least inflation or 2.5 per cent—could protect pensioners from losing purchasing power while reducing the risk of the current formula driving costs higher.
The case against
The triple lock offers pensioners a clear, predictable safeguard by linking increases to whichever of inflation, earnings growth or 2.5 per cent is highest. Removing the earnings measure could mean future pensioners receive less than under the existing formula, and the projected savings are uncertain: Hymans Robertson estimates they could be halved if economic growth is weak.
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