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Pension Triple Lock Costs £12 Billion Annually, Warns IFS

10/22/2025

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Summary

Story summary

The Institute for Fiscal Studies warns the pension triple lock costs about £12 billion more per year and benefits wealthier retirees.
That policy could push pension spending up by about £80 billion by the 2070s.
The IFS proposes a smoothed earnings link, similar to Australia’s, to ensure sustainability.
The state pension is set to rise 4.8% in April 2026 to about £241.30 per week.

History

Historical Context

The UK introduced the pension triple lock policy in 2010 to ensure annual increases in state pensions, linking them to inflation, earnings growth, or a minimum of 2.5%. By 2026, the state pension is expected to reach £241.30 per week, costing taxpayers around £12 billion annually. This policy raises concerns about sustainability, echoing similar debates from Australia’s pension reforms.

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Story summary

The Institute for Fiscal Studies warns the pension triple lock costs about £12 billion more per year and benefits wealthier retirees.
That policy could push pension spending up by about £80 billion by the 2070s.
The IFS proposes a smoothed earnings link, similar to Australia’s, to ensure sustainability.
The state pension is set to rise 4.8% in April 2026 to about £241.30 per week.

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