The triple lock, which was introduced in 2011 by the coalition government, guarantees the basic state pension will rise by a minimum of either 2.5%, the rate of inflation or average earnings growth, whichever is largest.
The Social Market Foundation (SMF) think-tank proposes that the massive economic cost of the emergency measures deployed to manage the pandemic must be shared fairly between old and young, and that some of the huge anticipated government deficit could be funded by abandoning the so-called triple lock guarantee on state pension rises.
Scott Corfe, the SMF’s research director said: “Quite rightly, society is making sacrifices to protect its elderly right now. There is a clear case for intergenerational reciprocation when it comes to meeting the fiscal costs of the crisis in the years ahead..."
The thinktank argues that the economic impact of lockdown policies – which it says have “have rightly been deployed to protect the lives and wellbeing of those most vulnerable to the virus” – is falling most heavily on working-age Britons, “many of whom face redundancy followed by years of higher taxes, reduced services, and slow economic growth”.
The SMF said any future austerity programme must not favour pension spending over working-age welfare, as happened after the financial crisis. It proposes replacing the triple lock with a “double lock” that removed the 2.5% promise and would save an estimated £20bn over five years.
The Social Market Foundation (SMF) think-tank proposes that the massive economic cost of the emergency measures deployed to manage the pandemic must be shared fairly between old and young, and that some of the huge anticipated government deficit could be funded by abandoning the so-called triple lock guarantee on state pension rises.
Scott Corfe, the SMF’s research director said: “Quite rightly, society is making sacrifices to protect its elderly right now. There is a clear case for intergenerational reciprocation when it comes to meeting the fiscal costs of the crisis in the years ahead..."
The thinktank argues that the economic impact of lockdown policies – which it says have “have rightly been deployed to protect the lives and wellbeing of those most vulnerable to the virus” – is falling most heavily on working-age Britons, “many of whom face redundancy followed by years of higher taxes, reduced services, and slow economic growth”.
The SMF said any future austerity programme must not favour pension spending over working-age welfare, as happened after the financial crisis. It proposes replacing the triple lock with a “double lock” that removed the 2.5% promise and would save an estimated £20bn over five years.
“In the context of an annual deficit that could reach £200bn as we emerge from the crisis, shaving £4bn a year from the growth of the £100bn pension bill is not too much to ask. It would also demonstrate reciprocity from a group whose wellbeing was, rightly, prioritised during the lockdown phase of the crisis,” the SMF said.
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