Ditching the triple lock would be unpopular – and deeply worthwhile

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Liz Truss is said to be reconsidering the pensions triple lock
Liz Truss is said to be reconsidering the pensions triple lock

Liz Truss said she wanted to be unpopular. She’s certainly achieved that over the past few weeks, and to not much obvious benefit to either her party or the country. But if, as suggested, she takes aim at the triple lock on pensions we may finally be looking at an unpopular decision worth making.

The lock – which ensures the state pension goes up at either 2.5 per cent, the rate of inflation, or average earnings, whichever is higher – is bad policy. It is universal, it is tipped towards the most extravagant uprating, and it ignores the wider context of the UK’s economic demography.

The triple lock’s flaws have been thrown into greater light by the pandemic – which hit younger workers, without a home and often in lower-paid work, far harder than those up the age or income ladder. In 2021, the average house ‘earnt’ more than the average British worker.

That is nonsensical – bad for growth, bad for Britain, bad for those who believe in the basic tenet of capitalism that work pays. It is absurd that the government would uprate the pensions of a generation who mostly already own property instead of cutting taxes on those at the bottom end of the income scale who don’t.

Pensions triple lock

As we enter the second age of austerity, it is only right that it falls across all areas of day-to-day spending. The triple lock is a bind – it was designed poorly, and nobody involved in its conception ever conceived of a world in which we had inflation tipping 10 per cent. In these extraordinary circumstances, extraordinary action is required.

It should not be beyond the wit of our civil service to concoct a scheme which ensures those who need the pension uprating the most are able to receive the cash that they have expected their whole lives. Clearly, those individuals deserve support, not least in an energy crisis.

But the triple lock is a blunt tool, and a costly one at that. If getting rid of it is the Truss government’s only achievement, it may not have been a total waste.