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.

So I can’t be an economist because I feel that a formula that demands that the income of one group must increase faster than the average of all the others is unfair?

So you will be refusing your state pension then when you reach that age??,

Yes why should state pensions be protected when nothing else is . Tax brackets haven't moved with inflation, house prices haven't been controlled, social housing is non existant, private pensions including civil service are worse, student debt is massive. The list goes on.
Nothing has been protected for us.
I have absolutely no faith that the state pension will be protected for us, regardless of what we do for pensioners today.

I do realise,as a pensioner, that families with children are on average struggling more than pensioners . However not all pensioners are wealthy and I don’t know how stories about people who have never worked a day in their life and get 2.5K tie in with most people’s experience. Instead of looking across the age groups I think it’s more productive to look across the income distribution in general. Why are some jobs so poorly paid? What is valued and what isn’t? I don’t think pensions should increase at a faster rate than incomes but it’s the inequality generally that’s the issue. I am not a Tory voter either, far from it.

Triple lock should be up for debate it is unfair as they apply different standards to different benefits . My objection to triple
lock is that enough pensioners feel insured with triple locks and enough have no real skin in the game when it comes to the economic consequences of their voting decisions. (Cost of living crisis aside)

however touting it as an either / or option is unreasonable. It’s falling for the classic divide and rule tactics the conservatives employ and a race for the bottom. If we all had a triple lock the country would be richer due to higher tax intake.

No, OP - I am questioning you because you are so unthinkingly accepting Tory premisses regarding the undesirability of properly funding spending through (various forms of) taxation. FWIW, I am not a pensioner

You aren't describing how the Triple Lock actually works. I am starting to feel your contributions really aren't in earnest now so I'll give up trying to have a proper debate and leave you and your friends in your ill-considered soundbit bubble - have fun.

OK Flamm, as an economist you must have some ideas of how to ensure that people who have reached the end of their working lives receive enough of a pension to enable them to live in dignity and comfort while replacing the triple lock; but instead all I see is you asking a lot of questions and not having many answers. Almost as if you're trying to gauge public opinion on a popular website and whip up opinion against the triple lock.

Is that what you are doing? floating ideas to see how they are received?

OP, those other countries in the OECD study I referenced mostly have private pensions too, ya know

I see we've reached similar conclusions about the OP at about the same point in this thread :)

Pensioners still pay tax, so any of these wealthy pensioners are paying tax and contributing to the system. That's one of the reasons they dont means test the state pension as they get a chunk back through the bau tax system.

These threads are so boring and ageist and seem to be created by people without any actual depth beyond a click bait title.

Exactly.

Well let's assume the Tory Party are out at the next election and most pensioners vote for them.

The end of triple lock. It nearly went this year except for some desperate Tory MPs wanting to save their seats.

A policy that has had its day.

I see we've reached similar conclusions about the OP at about the same point in this thread :)

I err on the side of being cynical generally so I hesitated before asking but there's a definite pattern to the posts.

The Triple-lock works by meaning that pensions increase by the higher of either average earnings, inflation or 2.5% each year. This means that in years where average earnings increase by a large amount, pensions increase by the same amount, but when earnings growth is lower than inflation, pensions continue to grow by inflation.

In any one year, the difference may not seem much. But over 10 years it is very substantial. For the last ten years workers incomes have stagnated, but pension incomes have grown significantly in real terms.

I think it’s now unsustainable and unjustified. And yes, I have two economic degrees and work as an economist. And I don’t vote Conservative (and never will post-Brexit)

I agree with you OP but many won't. Why should pensioners get a 10% increase when teachers have had a pay freeze for years and now are looking at 5% BUT coming out of existing school budgets so quite likely won't get any rise at all.
Makes me mad!

I suppose it makes a change from a benefits bashing thread.

@MrsDanversGlidesAgain @WatchoRulo

Couldn't agree more with everything you say.
And yes, I will (soonish) be drawing my state pension but I'm not a Tory voter, and nor will I be weatlthy.
Bit like the whole Brexit thing. Be careful what you wish for.

MrsDanvers - I suggest a Single Lock. The state pension increases in line with average earnings.

Please explain what is wrong with that?

how does the £8840 my mother gets equal £20K? DF gets £10000. Even added together this doesnt make £20K.
No one can live on that if they are renting which many pensioners are.

We are working an extra 8 years for £10,000 a year and you think that right lolololol, youngsters today are so deluded and think they are so hard done by…cut it with the ‘poor me’ attitude when you have left uni at 21,22 and work for 10 years and start moaning. I started work at 16, trained in my profession and am still doing it at 61, retire at 68… that 52 years of work!

This to me is another Brexit bus with magic hundreds of millions that will go to the NHS.

Meanwhile - government elects a leader that costs 30bn in a few weeks!

Go through all the companies that made money from Covid and do a one off tax? Nah - hit the pensions.

It seems short sighted to me - what happens when they need care? A quick Google puts the average cost of care from 600 to 2,000 per week.

Teachers have a starting salary of £28K. So two teachers (married have a combined salary of nearly £60K). Maybe thats why the triple lock is necessary, the starting amount for pensioners is massively low.

I get the "single lock". Makes sense.

Probably what will come post the next election anyway.

Did you? I must have skimmed past that. How will it work and what effect will it have on pensions and pension increases? will it ensure that nurses/doctors/teachers get a fair whack, as those seem to be the segments of the population that concern you most, rather than the millions of pensioners in poverty.