No certainty for triple lock – or much else for that matter.

Rishi Sunak stands accused by the FT of not standing by the triple-lock. What assurance can a politician give on manifesto pledges when ambushed in Hong Kong a year from an election.

There are a number of things we don’t know about the state pension – apart from the nature of its increases

  1. We don’t know when the state pension age will be for most people who haven’t yet retired (there’s a report submitted but not yet published or agreed) HUGE
  2. We don’t know what the Government is planning to spend on subsidies and incentives (until we have certainty on the 2017 AE reforms) MEDIUM
  3. We don’t ever know  quite how the triple lock will work – for instance what measure of Average Earnings the Government will use . (GEEKY)

People want to know for sure what will happen to pensions policy should take life lessons in “uncertainty”, for you will never know what will arrive until it comes. That is not to say we can’t make plans – it’s just those plans need to have uncertainty baked in, if we aren’t to fall prone to certainty bias (the bias I’ve just made up that assumes everything is going to turn out just as we planned).

The Geeky stuff can be a minor tweak or a major change. Moving from RPI to CPI was a major change dressed up as a geeky adjustment.

Baroness Steadman Scott’s 2023 review of the State Pension Age is sitting in the DWP’s in-tray gathering dust. There is a straightforward trade-off involved, the later the state pension age, the longer lasting the triple lock.

My view is that the longer the triple lock lasts the better, because state pensions are too low. But there is no triple lock on other retirement benefits linked to pension credit, the real victim of the triple lock is unlikely to be the state pension age but the continuing fall in retirement and pre-retirement benefits. These could also include whatever new formula the Government comes up with to sort out long term care.

Whenever I have a conversation with the Treasury, it is not about the intended but the unintended consequences of any proposed reform. It is “certainty” that the Treasury craves and the only certainty they can come up with is that given half a chance, we will game the public purse.

Public policy , private practice.

The uncertainty that makes Rishi Sunak sound like he’s back-peddling on a sort of promise made by Mel Stride in the summer

Sunak’s reticence to commit to retaining the lock beyond the forthcoming election contrasts with work and pensions secretary Mel Stride, who said in June it would “almost certainly” feature in the next Conservative manifesto.

This reminds me of another certainty that I’d forgotten about. Faced with the prospect of not filing a story on anything else, a financial journalist is certain to find a story about the uncertainty of our pensions.

Those in the private sector who pedal the certainty of future benefits or even future contributions should remember that the only meaningful certainties are death and taxes.

About henry tapper

Founder of the Pension PlayPen,, partner of Stella, father of Olly . I am the Pension Plowman
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1 Response to No certainty for triple lock – or much else for that matter.

  1. Pingback: When is a guarantee not a guarantee? – When it’s a pension promise | AgeWage: Making your money work as hard as you do

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