PM Announces Scraping of Triple Lock Pension Pledge to Fund Social Care

The Prime Minister has unveiled plans to dismantle the current triple lock arrangement for the state pension, a move designed to generate savings for a new social care strategy. Under the existing system, the state pension rises annually in line with the highest of three metrics: inflation, wage growth, or a guaranteed 2.5% increase.

Starting in April 2030, the mechanism will change. The direct annual link to earnings growth will be removed, leaving the pension to rise by either inflation or 2.5%, whichever is greater. However, the government maintains that the pension will still preserve its value relative to earnings over the long term.

Andy Burnham addressed the Labour Party conference, confirming that while the triple lock will be altered, the commitment to pensioner support remains. “The state pension will continue to rise every year at least by prices or 2.5%,” he stated. “And it will hold its value relative to earnings over time so that pensioners will always share in the rising prosperity of the nation.” He emphasized that the financial savings generated by this reform would be directed toward building a national care service.

This shift marks a departure from Labour’s 2024 manifesto pledge to maintain the triple lock for the duration of the current Parliament. The decision follows growing pressure regarding the escalating cost of the policy. In July 2025, the Office for Budget Responsibility (OBR) projected that the annual cost of the triple lock would reach £15.5 billion by 2030, a figure three times higher than originally estimated when the policy was introduced by the coalition government in 2010.

The Institute for Fiscal Studies (IFS) welcomed the proposed changes. Jonathan Cribb, deputy director at the IFS, described the reform as a “great improvement” that effectively removes the most expensive element of the triple lock. “State pensions will still rise, but more sustainably,” he noted, though he cautioned that the savings might not be sufficient to fully fund universal social care in the immediate future.

Concerns have also been raised regarding the tax implications of upcoming pension increases. With the personal allowance set at £12,570, the expected rise in the flat-rate state pension could push some retirees into income tax brackets. In April 2027, the new flat-rate pension is projected to reach £250.70 a week, potentially rendering pensioners liable for approximately £91 in income tax. Burnham reiterated that low-income pensioners relying solely on the state pension would not be required to pay income tax or complete tax returns during this Parliament.

The state pension age is also undergoing changes. For those born after 5 April 1960, the retirement age is gradually increasing to 67, with a further rise to 68 planned between 2044 and 2046 for those born after 5 April 1977. The transition to age 67 began in April 2026 and is expected to save the Treasury around £10 billion annually by 2030, although charities warn this may disproportionately impact regions with lower life expectancy.