Prime Minister Andy Burnham has made the politically risky decision to adjust the pensions triple lock from April 2030.
Speaking at this year’s Labour Party Conference, he said: “Some may not realise it but older people with nothing more than the state pension, or only a little more, can find themselves paying care charges today from that small income. Under my plan, this will no longer happen.”
But what is the triple lock, and why was the announcement so controversial?
The triple lock is a mechanism that provides a guaranteed increase in the basic and new state pension. It raises it by whichever is highest among average earnings growth, price inflation, or 2.5% and ensures that state pension payments increase in value every April.
Politicians have long considered any challenge to the triple lock to be highly risky to their chances at the ballot box. But how long has the mechanism been in place and what were the reasons for its introduction?
Read more:
Plans to tamper with the pension triple lock might not be as dangerous for Labour as some believe
Increasing the value of pensions has been hotly debated since the early 1970s. Back then, the Labour government introduced legislation to increase long-term benefits and state pensions in line with earnings or prices, whichever was higher – a “double lock” on pensions growth.
But by the late 1970s, the governing Conservative party deemed this mechanism “unsustainable” because of the same “ratchet effect” that the triple lock is now criticised for. In other words, for the rest of the population, their wages grew in response to inflation – but pensioners enjoyed the rise every year. Pensions were then linked to prices only, rather than slower-growing earnings.
During the 1980s and 1990s, concerns grew about a growing number of people falling into poverty in later life. Consecutive governments debated whether the link to earnings should be restored. At the same time, pensioners were experiencing a steady decrease in the value of the state pension relative to average earnings. This went from a peak of 26% of average earnings in 1979 to around 16% of average earnings between 2000 and 2010.
In 1999, there was a reckoning when pensioners received an increase of just 75p per week after a period of low inflation. The tiny uptick sparked anger and then-chancellor Gordon Brown was under pressure to act. Finally, in 2002, the Labour government legislated to increase pensions by the higher of 2.5% or price inflation. The double lock was back in place.
A key point came when the (first) Pensions Commission in 2005 published its recommendation that the government restore the link of pensions with earnings. This was a bid to reduce the risk of pensioners falling into poverty and placing pressure on the system of means-tested benefits.
This recommendation was followed by the announcement of a triple lock by the Conservative/Liberal Democrat coalition government in its first budget in 2010. It had been a key promise in the Lib Dem manifesto, and it was implemented in 2011 by then-chancellor George Osborne.
A growing gap
Since 2011, the triple lock has increased the value of the state pension considerably. Analysis by the Institute for Fiscal Studies (IFS) showed that between 2010-2023, the median disposable household income for pensioners rose by 15%. Cross-party support for maintaining the triple lock during the 2019 general election demonstrated a broad commitment to the steady increase of the state pension.
However, while average incomes in later life have risen, the gap between poorer pensioners and those on average incomes has widened. Relative poverty among pensioners rose from 13% in 2011, to 16% in 2022. Thus, the triple lock has not necessarily meant that fewer? pensioners are living in poverty.
The gap between average income and poorer pensioners has widened.
Maren Winter/Shutterstock
At the same time, the key safety net for low-income pensioners is not the state pension alone. Historically, this was provided by something called the minimum income guarantee. This is a means-tested benefit which ensures that pensioners’ weekly income does not fall below a legally set minimum (£238 per week for a single person in 2026/7, and £363.25 for a couple), which was also linked to earnings.
The minimum income guarantee was replaced by the guarantee element of pension credit (a means-tested benefit that tops up the income of poorer pensioners). This move towards some kind of guarantee of a minimum income didn’t come with the fanfare of the triple lock – but it did make a big difference to pensioners’ incomes before the triple lock was introduced.
The Resolution Foundation, an independent thinktank focused on raising UK living standards, estimated that there was a 15.8 percentage point fall in pensioner relative poverty between 1997-98 and 2011-12, as growing incomes for poor pensioners closed the gap with the non-pensioner median income.
But there are still an estimated 760,000 vulnerable pensioners who are eligible for means-tested pension credit, but who failed to claim it in 2025/6.
The government’s own analysis shows that this happens for a number of reasons: people may not have heard of it, or don’t know who to contact in order to claim it. The application process is complicated, and for some there may be stigma attached to claiming.
One solution to lifting more pensioners out of poverty might be increasing the value of pension credit and improving its take-up. It is notable that the triple lock does not apply to pension credit or to winter fuel payments, which use different criteria to work out the rate of increase.
Analysis by the IFS illustrates that the “new” triple lock, as outlined in Burnham’s speech, is still expected to generate an increase in the value of the state pension in the future. However, such increase will not permanently “ratchet up” the level of the state pension in the same way as the “old” triple lock.
Maria Evandrou receives funding from UKRI, ESRC, MRC, EPSRC and NIHR. Athina Vlachantoni receives funding from the Economic and Social Research Council. Jane Falkingham receives funding from the Economic & Social Research Council (ESRC).