UK's pension triple lock to cost three times' higher

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Kevin Peachey, Cost of living correspondent

Government projections show that the cost of the state pension triple lock will be three times higher by the end of the decade compared to the original estimate. The triple lock, implemented in 2011, ensures that the state pension increases annually in line with the highest figure from inflation, wage increases, or a 2.5% minimum. The Office for Budget Responsibility (OBR) predicts that the yearly cost will reach £15.5 billion by 2030.

The UK’s public finances are deemed to be in a precarious state due to recent government decisions to backtrack on planned spending cuts. The OBR noted that reversing the proposed welfare bill and reinstating winter fuel payments for most claimants have contributed to a continual rise in government debt, as outlined in a report. Efforts to stabilize the UK’s public finances have been somewhat ineffective, with debt levels rising and borrowing remaining high due to the abandonment of spending reductions and tax increases.

The OBR reported a steady increase in state pension expenditure over the past eight decades, from 2% to 5% of the UK economy, totaling £138 billion. It is predicted to climb to 7.7% of the economy by the early 2070s. Richard Hughes, chair of the OBR, emphasized that the triple lock and other age-related commitments are driving up public spending over the years. He warned that without adjustments, the UK’s long-term financial outlook is unsustainable given current economic growth and revenue projections.

The state pension is a significant budget item for the UK government, second only to health care expenses. The Conservative-Liberal Democrat coalition introduced the triple lock in 2011 to safeguard the state pension value from being surpassed by cost of living increases or working individuals’ incomes. Although inflation has been more volatile than initially expected, triggering the non-earnings-linked component of the lock in most years, the earnings link hiked the state pension by 4.1% in April 2025. Chancellor Rachel Reeves confirmed that the Labour government plans to uphold the triple lock until the end of the current Parliament

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