3rd July 2017

The “triple lock” was introduced in 2010 by the coalition government. It’s the government’s guarantee that the state pension will increase each year by whichever is the greatest of CPI inflation, average earnings or 2.5%. Its future looks slightly more certain following the Conservative pact with the DUP.

With an ageing population, the cost of retaining this promise represents a heavy financial burden and many believe that future governments will have to revise it. The triple lock is estimated to cost £45 billion over the next 15 years.

In his report on the state pension John Cridland, former Director General of the CBI, recommended that it should be scrapped. Others advocate a “double lock” that drops the link to the 2.5% and instead uses the higher of earnings or inflation. However, the Institute for Fiscal Studies has said that even the double lock would represent an increasingly heavy financial burden.