Posted on: 14th May 2019
It has been suggested in a recent report from the House of Lords that the statetriple locked should be scrapped. The triple lock is a device that is used to keep the state pension in line with the cost of living and inflation. The report looked into balancing out wealth disparity between the young and the elderly in Britain. Also, the report included suggestions to scrap free TV licenses for those over the age of 75, as well as getting rid of free bus passes.
What is the triple lock?
The triple lock was introduced in 2010, ensuring the state pension will rise each year by a certain amount. This increase is determined by three things: the rate of inflation for September of the previous year, the average increase in earnings, or 2.5 per cent. The increase will match whichever of these is highest.
By scrapping the lock, the pension would not rise at such as rate. This is something that will likely be unappealing to pensioners. Instead, it was suggested that the rates should rise to match average earnings. However, the report claimed that these increases are not sustainable. However, due to the rising age of the population, some feel that spending more on pensioners will affect the services that taxpayer money can provide for the young.
Over on Twitter, users have rallied together against the idea of removing the triple lock. One user wrote, “This week Theresa May boasted her party had protected theof the elderly with the triple lock. In 2017 her party stood on a manifesto to raid their pensions by REMOVING the triple lock! Please refresh her memory with a Retweet!”
Another said, “So the misogynist lords have degreed the working class should have no life after work live in poverty die in poverty.”
The next significant date in relation to these rises should be 6th July 2019. It’s on this when those born between 6th February 1954 and 5th March 1954 reach the age of state pension eligibility. Due to the different timeframes, the increase in age has been a gradual one. By October 2020, the state pension age for both men and women should be 66.
Be ready for any financial changes with
You never know when a new change that will affect your pension is going to be introduced. This is why it is of high importance that you speak with an independent financial adviser to ensure that your future is safe, no matter what happens. If you would like to learn more about seeking financial advice, get in touch with Haven IFA to see how we can help.