Last week I commented on the choice that the Pensions Minister has over whether to promote the triple lock, retain the current state pension age or do both, Here are younger voice.
My friend Andy Young had privately reproved me for what I’d written in a daily paper
Here he is speaking publicly on linked in;-
Andrew Young
A few weeks ago I made the following comment on the triple lock.
Given world events since the, inflation expectations at least in the short term have probably changed, but the times in my comment are over a year ahead.
“Fom September 2027, 2028 and 2029 when decisions are made about basic state pension increases, the 2.5% underpin is expected/projected to be HIGHER than BOTH price and earnings increases for 3 years. Can the triple lock survive that?”
Pensions only take 5% of expenditure and figures from IFS project this to get to 8% by 2050 ( from memory) Are we due for a change in SPA? Are the self employed still to be the next crisis?
The more pressing problem is the health service already at 10% with no debate on how this is controlled.
OBR – LOL
Home Office and OBR long term growth forecast rely on stable demographics by assuming we can attract 9m skilled workers from overseas over the next decade, and that allows the OBR model to maintain GDP growth aspirations and to provide the workforce gap for NHS and social care (ie in the words of Zack Polanski “to wipe our bums” in our dottage).
Underlying that SW1 centric solution is the belief and hope that those new workers will have the necessary skills and propensity to fill the roles.
Things move fast however, and the paradigm shift that Whitehall can’t quite face quick enough is the impact of AI and robotics. The productivity gains will be rapid and enormous (IF we embrace growth and provide the electricity !) and it’s becoming increasingly clear there will not be jobs for the 9m new workers, nor the 30-40000 medical graduates looking for jobs…
I’ve no doubt OBR bods will be thinking about all of this, the real question is whether they’ll be allowed to surface their conclusions. Critical they do for all our sakes, but of course more expedient and Easier for the Minister to continue to raid DB schemes (LGPS next) and mandation.
The OBR forecast is CPI inflation at 2.0% in 2027-28 and 2.1% in 2028-29, with 2.2% in 2026-27.
For earnings, that same OBR source says nominal average weekly earnings growth falls to 3.2% in 2026-27 and then stays between 2.1% and 2.3% from 2027-28 onward.
Does anyone take the OBR seriously?
“All models are wrong, but some are useful.”
Thanks for these comments Jnamdoc and Derek