Lord Walker, Iceland boss and Labour peer, has called for the triple lock pension to be scrapped, citing its "unsustainable" and "profoundly unfair" nature. He argued the mechanism leads to pensioners receiving increases significantly above workers' wage growth.
The call by a prominent business leader and political figure to scrap the triple lock pension highlights growing concerns over its long-term fiscal sustainability and fairness, potentially signaling future policy debates on state pension reform.
Lord Walker, the influential Iceland boss and a Labour peer, has called for the triple lock pension to be scrapped, describing the mechanism as "unsustainable", "politically untouchable", and "profoundly unfair". Speaking in the House of Lords during a debate on welfare reform, Walker argued that the policy, which increases state pensions by the highest of average earnings, inflation, or 2.5% annually, often results in pensioners receiving increases significantly above those of workers.
His comments align with criticisms from the Resolution Foundation, a think tank formerly led by Treasury minister Torsten Bell. The foundation reported that the state pension has cost approximately £12.6 billion more than it would have under a "smoothed earnings link" proposal. This alternative would tie pension increases to prices when inflation exceeds earnings growth, before aligning with average earnings in the long run, ensuring sustainability for public finances.
Walker's remarks echo sentiments previously expressed by other prominent political figures. Former prime minister Tony Blair and current Chancellor Jeremy Hunt have also advocated for replacing the triple lock. Hunt notably described the policy as "immoral" and a "drag anchor on economic growth" due to its financial burden on public finances. Other organisations, such as the Centre for British Progress, have proposed alternative mechanisms, including linking pension increases to a 10-year average of wage growth or the previous year's inflation.