The Pensions Triple Lock has to go

[Flammkuchen]

When it was introduced, the aim of the Triple Lock was to increase pensions faster than earnings as the state pension was low. The TL has been very successful: pensioners now have a higher standard of living and more disposable income than working families. A pensioner couple each getting the full state pension receive £20k per year, with any private pension income on top.

This is great for them, but it comes with a trade-off. In order to increase pensions by over 10% a year, there is less money to pay nurses, teachers or doctors. Highly skilled public sector workers have low pay and there is a recruitment crisis.

AIBU to think that now that on average pensioners have higher disposable income than those in work, a policy that aims to increase pensioner income by MORE than average earnings - and so keep increasing the income of pensioner households faster than working households - needs to be rethought? Even just linking the state pension to average earnings would be better.

Discussing it is not an attack on pensioners, nor saying that they should get their incomes cut. It is simply saying that the policy has been successful in alllowing pensions to catch-up and now is no longer needed

Of course it isn't. Pensioners now get £ 10K a year, they're rolling in wealth. Who cares about the ones below the poverty line for who that's their sole income, eh?

The person living on 10k a year has already explained. You just don't want to hear.

Even if you did want to make changes it would be unreasonable to change it now, for those currently entitled to the amount, or to those nearing the end of their working lives. People make long term plans for their retirement, and this takes into account the state pension system. They can't suddenly change their plans for a new system.

So any changes made now realistically shouldn't come into play until the younger people are ready to retire.

' Pension benefits' are already means tested iirr, just not the base level.

If you let the pension erode every year, it'll be worth fuck all by the time you come to receive it.

Is that an outcome anyone wants.

It keeps pace with inflation, but not much more.

That earnings don't necessarily do so is a separate question, not a reason to consign more to poverty.

According to Age Concern, the proportion of pensioners in poverty has risen to 16%.

For children it's 12% and working age adults 7%

The portrayal of pensioners as a group as affluent is just plain wrong

I'm happy for pensions to have a good income.
What I'd like to see taxed though is the massive great inheritances they leave to their children. It makes absolutely no sense to me that money people work hard for and have to spread so thinly to get by is heavily taxed but hundreds of thousands of pounds, that the recipient has done absolutely nothing to earn isn't taxed a single penny.

Op, do you live in £10k yourself?

It's not a huge amount.

I don't see why it can't just match inflation

Quite. "But my PIL/DM!" is the cry. Anecdote is not evidence but they don't care about evidence when they can get a nice rant on and call it a "discussion"

The pension would still increase in line with earnings.

As a nurse, you will of course get the state pension (increasing with earnings) and the NHS pension. You will probably be better off than you have ever been.

The Triple-Lock comes at a cost and giving higher pensions each year means giving lower pay for nurses, doctors and teachers. Which do you support?

And as for the TL, obviously it will have to change eventually.
It's the highest of either , earning, inflation, or 2.5%, if that stays itll eventually be worth more than working a full time job, and STILL continue growing.

Do any retired people really think their pension should grow faster than nurses wage? Please do explain

A nurse's starting pay is £ 24,907. More than double the state pension amount. However much you increase the pension by, it's not going to make the SP more than what a nurse earns, is it? it's only in percentage increase terms that pensioners do better, not actual income.

You do know that lots of pensioners live in single person households and that their costs are not 50% of a 2 person household? Council tax only gives 25% discount. Heating the house costs the same whether there's one person or two. So whilst £20k per annum sounds like a decent income, £10k is not.

I'm sure plenty exist and the odds are I'll be one of them in 20 years time.

I'd be happy for changes to be made so that less we'll off pensioners got an extra boost by way of pension credits.

I just don't think those that are living very comfortably, mortgage free with hundreds of thousands or more in the bank should be having even more thrown at them when it could benefit those worse off, regardless of their age.

The Triple-Lock comes at a cost and giving higher pensions each year means giving lower pay for nurses, doctors and teachers. Which do you support?
This simply isn't factually the case, it's over-simplified divisive rhetoric - are you from UKIP?

Changing the pension to link to increases in earnings would not reduce the current pension. It would still increase.

But the point of the triple-lock is for pensions to increase over time faster than earnings. It is unsustainable.

What on earth would be wrong with pensions increasing going forward at the same rate as earnings?

The Triple-Lock comes at a cost and giving higher pensions each year means giving lower pay for nurses, doctors and teachers. Which do you support?

I support both.
You are trying to manipulate people's answers.

When did yoy stop beating your children? I mean, it's not as if you're the only one who gets to ask loaded questions
False dichotomy. Public finances are not ring fenced. They could increase public sector wages by taking funds from, say, defence.

I guess the counter argument there would be that the inheritance was earned by someone, and has therefore already been taxed.

No, I'm not due to receive a big inheritance,if any.

Our dd is may do when we go though. Only child and we have savings, etc. DH is on a high wage, I earn, we don't have huge mortgages, etc. so we do save. All of the money we leave her will have been taxed already. Is it right that the money should be taxed again?

And if it was, won't people just get around it even more than they do so now with making generous gifts throughout their lives to their children and grandchildren, signing their house over well beforehand, etc.? It happens now, it would just happen more.

To be fair if you were on 10k and paying rent you would get help. I wish someone would answer the question and define wealthy though. I think I have gone wrong somewhere. I worked for the NHS for forty years( had other jobs previous to that but no private pension for those). My income from state pension is £7,700pa ( because I paid nhs pension I was contracted out). My private pension makes my income up to £18,000. This is adequate but I am spending most of what I get monthly. I own a house outright, so am I wealthy? I think I am fairly average for a pensioner, not poor, not wealthy. I don’t know many people like the wealthy pensioners other people seem to know. Perhaps those people had inheritances themselves or had houses in London rather than the north. I don’t know how you define wealthy and how you would means test.

I know a lot of wealthy pensioners including my partner's parents. My own widowed mother only gets state pension with no benefit help and yet still manages with cash to spare. The very poorest pensioners who didn't work and don't have a state pension have benefit assistance and free rent etc.

Yet.... pensioners are often moaning.... yet when they die they appear to leave lots of cash/property etc....

I'd be happy for changes to be made so that less we'll off pensioners got an extra boost by way of pension credits

Or, you know, pay a decent pension to start with.

Pension credit is for people who retired before the introduction of the flat rate SP in order to bring pensions up to the rate now paid under the flat rate SP. So it's already doing that.

I just don't think those that are living very comfortably, mortgage free with hundreds of thousands or more in the bank should be having even more thrown at them when it could benefit those worse off, regardless of their age.
Pensioners pay income tax and consumption taxes such as (but not limited to) VAT and Capital gains taxes so they will be paying in if they are really that well off.

Your grandfather did not receive a state pension at 60:though did he?

This:

"I just don't think those that are living very comfortably, mortgage free with hundreds of thousands or more in the bank should be having even more thrown at them when it could benefit those worse off, regardless of their age."

Many are literally rolling in money and assets and yet get lots of free cash thrown at them

Actually, if government spending is constrained ultimately by the level of tax income, then more spending in one area means less spending elsewhere.

Unless you believe in the Liz Truss magic money tree.

And no, I am not from UKIP, but I am an economist who does not understand why this policy has become a Sacred Cow.

The Triple-Lock was introduced because Thatcher had cut the link between pensions and earnings which meant the pension became very low. The Triple-Lock has been hugely effective in boosting pension income. It is now time to restore the link with average earnings.