skip to navigationskip to main content

Pension triple-lock abandoned for one year

The government has confirmed that its triple-lock guarantee on pensions is to be abandoned for one year. The guarantee was first introduced in 2010 and has remained in place until now. This guarantee has seen the full yearly State Pension increase by over £2,050 in this period.

The triple-lock is the mechanism used to calculate increases to the state pension each year. Under the triple-lock guarantees the basic state pension rises by whichever is the highest out of average earnings growth, inflation or 2.5%.

The government is concerned that the growth in earnings will be between 8% and 8.5% and has decided that setting aside for one year the use of average earnings growth figures for State Pensions would be prudent. This large growth figure has been caused by the unprecedented fluctuations to earnings caused by the COVID-19 pandemic.

The other two elements of the triple-lock will remain in place, meaning that the State Pension will be uprated by the higher of inflation or 2.5%.

The government has argued that this pause in the triple-lock is the fairest approach for both pensioners and younger taxpayers. However, this decision will leave many of those in receipt of the State Pension deeply disappointed with this decision and worried that this is the start of further broken promises.

It had been rumoured for quite some time that HM Treasury was exploring ways to suspend the triple-lock as it became apparent that the earnings growth figure would appear to be artificially high.

Working with you

Whether you're starting from scratch or have been in business for years you'll benefit from working with D.R.E. & Co. advice on how to take you to the next level.

fixed-quote-man.jpg

About us

We work closely with our clients and act for a broad range of business....

business-advice-couple.jpg

Get in touch

Simple way to contact us. Just fill in a simple form.

free-consultation-couple.jpg

Our services

Find out details about what we can do
for you.