Burnham plans to legislate away pension triple lock before next election

Andy Burnham plans to legislate for changes to the state pension triple lock during this parliament, although the government has pledged to keep the guarantee until 2030, after the next election.

The guarantee raises pensions by whichever is highest among 2.5%, inflation and earnings growth. Under the proposed system, the earnings element would be adjusted to prevent sharp increases in years when wages rise unusually quickly.

Guidance published alongside Burnham’s conference speech says MPs will vote on the changes before 2030. Parties would therefore enter the next election with manifestos setting out whether they would retain Labour’s changes or repeal them if they formed the next government.

Government estimate of savings

The government estimates that adjusting the guarantee could reduce state pension spending by £15bn a year by the end of the 2030s and by £50bn a year by 2050.

The Resolution Foundation said the savings were extremely difficult to estimate. Depending on which recent decade was used as a model, its figures ranged from nothing to about £24bn a year.

The foundation’s chief executive, Ruth Curtice, said the mechanism would save most in a volatile economy, while prolonged weak real-earnings growth could still make the protections expensive.

Opposition and care-service plans

The Conservatives, Reform UK and the Liberal Democrats have criticised the proposal. Some Conservative and Liberal Democrat MPs are also unhappy that their leaders are campaigning to retain a policy they consider too costly.

Sharon Graham, general secretary of Unite, called scrapping the triple lock to fund changes to social care “electoral suicide”. YouGov polling, however, found that 48% of voters supported Burnham’s plan and 28% opposed it.

Burnham said savings from the changes would fund a national care service in England that would be free at the point of use. The planned system is expected to follow Scotland’s model by covering care costs but not accommodation.

He also promised to exempt lower-income pensioners from income tax during this parliament.