Triple Lock finds favour with half of UK adults

17 August 2021

Half of UK adults believe the triple lock should be retained, according to new research from Canada Life.

The assurer’s survey of 2,000 UK adults found that almost half (46%) believe the state pension triple lock should stay as it is, despite the earnings figure linked to any increase predicted to be around 8% this year.

The triple lock currently guarantees that the state pension will rise by whichever of the following is highest; inflation, earnings or 2.5%. The impact of many people rejoining the workforce after furlough is largely believed to be the cause of the current higher earnings growth.

Over 50’s are much more likely to want to keep the triple lock promise with almost 6 in 10 (59%) supportive of maintaining it compared to around a third (34%) of those under 50.

Only 16% of respondents supported a move to a less generous ‘double lock’, which would lead to an increase in line with inflation or 2.5%. Even fewer people (14%) supported the idea of finding a compromise to use a lower earnings figure with the furlough impact stripped out.

Commenting, Andrew Tully, technical director at Canada Life says: “Maintaining the triple lock has long been a manifesto promise. However, no-one could have predicted the 18 months we’ve just experienced with the effect of millions of people being placed on furlough, artificially boosting the earnings data as they return to work.

“The Government has a difficult path to navigate, to ensure the state pension remains affordable in what is a difficult time for the nation’s finances, while also bearing in mind it’s manifesto commitments. It’s important to remember that each 1% rise in state pension costs the taxpayer around £850m a year.

“One option could be to strip out the artificial earnings growth from the data, making it more representative of the real underlying growth in earnings. The state pension would increase by a material amount, hopefully seen as fair in these exceptional circumstances, and making sure manifesto pledges are met.”

An individual needs 35 years NI records to qualify for the full new State Pension. The new State Pension has increased by 15.4%5 since April 2016 (from £155.65 a week to £179.60 from April 2021).

According to Canada life calculations, to buy the equivalent new State Pension of £179.60 a week would cost around £320,000 using an inflation-linked annuity at today’s rates.

Since 2011/12, the following benchmarks have been used for the annual uprating in line with the triple lock guarantee.

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