State pensioners risk losing £460 because long-standing rule could be scrapped

State pensioners could lose £460 in future years owing to a Triple Lock rule change. The long-term sustainability of the pensions triple-lock has been called into question yet again after new figures showed an extra 220,000 people were receiving the state pension.

According to data from the Department for Work and Pensions ( DWP ), 12.9m people were receiving the benefit in May 2024, a 1.7 per cent increase on the previous year. Heidi Karjalainen, senior research economist at the Institute for Fiscal Studies (IFS), said the policy “ratchets up the value of the state pension relative to average earnings in a way that will ultimately be unsustainable for public finances”.

“While the policy is undeniably popular, it raises critical questions about fiscal sustainability,” Ian Cook, a chartered financial planner at Quilter Cheviot, said. “Labour’s planned review of pensions and retirement savings now presents an opportunity to critically assess whether the triple lock remains appropriate in the long term,” he said.

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“The government must navigate a complex balancing act which still protects the incomes of current pensioners while ensuring that the system remains fair and affordable for younger generations.” The Triple Lock is worth £460 next year - sparking fears of its affordability.

“This would provide more certainty for individuals in terms of how much they will receive from a state pension and how much it will cost the government in the future,” she said. Caroline Abrahams, charity director at Age UK, said there was “no getting away” from the fact of an ageing population, but she said this also presented a “big opportunity” for people enjoy longer and more fulfilling lives.

“We shouldn’t forget that there are 1.5m people aged over 65 currently in paid employment, with countless more contributing by volunteering, caring and taking part in their local community,” she said. A Labour Party government spokesperson said: “This Government is committed to the Triple Lock, with millions of pensioners set to see their yearly State Pension rise by up to £1,900 over the course of this parliament.”