Triple lock on state pension payments have cost the Chancellor £28 billion over the past six years
Experts said the money had sucked up money that could otherwise have plugged the NHS and social care shortfall
INFLATION-BUSTING state pension payments have cost the Chancellor a whopping £28 billion over the past six years, new figures show.
Pension experts said the ‘Triple Lock’ guarantee on retirement payouts had sucked up money that could otherwise have plugged the NHS and social care shortfall.
Introduced by David Cameron in 2010, the Triple Lock has ensured the state pension has gone up by at least 2.5 per cent a year.
If the state pension had instead gone up in line with pay the Government would have saved £28 billion over the past six years because of the squeeze on wages.
If the Government had used a ‘double lock’ – and put the payout up in line with either inflation or pay – it could have saved £3 billion.
Chancellor Philip Hammond has been left with a £2 billion hole in the social care budget after ditching his tax raid on the self-employed.
Former Pensions Minister Steve Webb said: “Back in in 2010 the state pension in Britain was one of the lowest in Europe.
“The triple lock policy has started to reverse that but at a price.”
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Mr Webb – director of policy at life insurer Royal London – added: “Boosting the incomes of over 12 million pensioners does not come cheap and still leaves the basic pension at just £122.30 per week from next year.
“The challenge for politicians will be how to balance further improvements to the state pension against the other competing pressures on public spending.”
The figures came a day before former CBI chief John Cridland is due to unveil the findings of his Government-backed review of the state pension.
In October, the business guru suggested that manual workers and those in towns with low life expectancy should be allowed “early access” to their retirement pots.
And he urged the Government to consider scrapping the Triple Lock because of the cost.
In its Budget forecasts, the Office for Budget Responsibility said the state pension bill will soar from £94 billion to £106 billion within the next five years.