Andy Burnham issues verdict on proposed DWP rule change for 13 million state pensioners

The Prime Minister has been urged to make a major change

The Government looks increasingly likely to face mounting pressure to abolish the state pension triple lock over the coming year following confirmation from Andy Burnham that there were no plans to abandon the policy.

The triple lock guarantees the rate of the state pension rises every year in line with whichever is highest out of inflation, wage growth or 2.5%. However, this can – and frequently does – result in costly above-inflation increases.

And that appears set to be the case once again in April 2027, based on current projections. The latest wage growth figures of 4.1% sit above inflation.

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The rise to the state pension earlier this year was also based on wages. The full state pension is on course to climb by over £500 next year.

The triple lock is enormously expensive for the nation as increases are secured annually, as the name implies. Even if the amount surges in one particular year, it would still be required to rise again the following year.

It essentially leaves any government held hostage to pension increases. Calls are growing ever louder for the triple lock to be scrapped, but any decision to do so would represent a bold political move.

Burnham has acknowledged questions surrounding the triple lock but has said it would be “dangerous” to go against the Labour manifesto.

Leading economists maintain it will ultimately fall to a Prime Minister to make the defining decision.

The Organisation for Economic Cooperation and Development (OECD) is amongst influential bodies to call for reform. Mark Pemberthy, benefits consulting leader at Gallagher, said: “Andy Burnham has declared he has a plan, but we may need to wait a while before we know exactly what that means for pensions.

Angeline Ong, senior investments analyst at IG, said: “The OECD has added its voice to a growing chorus questioning the long-term sustainability of the triple lock, but politics remains the biggest obstacle to reform.”