State pensioners have been issued a warning over a Department for Work and Pensions ( DWP ) shake up – because the current system is believed to “not be sustainable”. State pensioners who have the Basic or Full State Pension have been warned by a pensions expert.
Under the triple lock, state pensioners are awarded an annual payment rate hike but analysts are questioning whether it is affordable long-term. Steven Cameron, the director of Pensions at Aegon, said reforming the state pension would be “very concerning” to pensioners.
“If the triple lock is left as is, over time, state pensioners will get higher increases than average wage growth. That lacks intergenerational fairness and it’s not sustainable,” Mr Cameron said, after Kemi Badenoch – the Conservative Party leader – hinted the state pension could become means-tested.
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Mr Cameron urged the DWP to “smooth over” the triple lock rules, meaning pensioners would receive an inflation increase as a minimum, with additional uplifts if wage growth over the previous three years averaged higher than inflation.
“This avoids widely fluctuating outcomes at times when both inflation and earnings growth are unpredictable, smoothing things out but ensuring pensioners still share in sustained increases in the nation’s wealth,” he said this week
“While state pensioners should take comfort from the government’s commitment to the triple lock for the term of this parliament, its future longer term has to be in question,” he said. “We’d call on the Government and politicians from all parties to step up, and rather than vote scoring, seek a sustainable solution that’s fair across the generations,” Mr Cameron added.
A Labour spokeswoman said: “Badenoch has put pensioners on notice – she’s going to cut your state pension.” Liberal Democrat Treasury spokeswoman Daisy Cooper joined the criticism, saying: “Bungling Badenoch has finally come up with her first new policy, slashing the state pension.”