Prime Minister David Cameron has promised pensioners a more secure future as a campaign pledge this week.
“A conservative government will offer pensioners a more secure future by pledging today that we will carry on using the triple lock after the next election to protect the basic state pension.
“We can only afford to do this because we are taking difficult decisions to cut the deficit and get spending under control as part of our long-term economic plan.
“I want to do everything we can to help people who have worked hard and done the right thing.”
The triple-lock guarantee system means that the state pension will rise by whatever is higher: inflation, average earnings, or 2.5%.This three-facet protection was introduced in 2010, and Cameron has pledged to keep it in place if the party is elected again in 2015.
However, the proposals have not been universally well-received, and a report released today by the Institute for Economic Affairs (IEA) said:
“To continue to increase state pension expenditure in real terms are both unaffordable and irresponsible. Instead, the government must accelerate the introduction of a later retirement age and urgently reform labour market regulations to enable people to work longer.”
The IEA set out ten policy recommendations “which could alleviate the fiscal problems caused by an ageing population”, including a recommendation to link retirement age with life expectancy, accelerating the rise in pension age and encouraging individuals to save for retirement.