Gov Defeat on Suspending State Pension Triple Lock

The Government was yesterday defeated in the House of Lords on its amendment to suspend the triple lock on state pensions.

In the House of Lords vote, 178 voted to allow the amendment and 220 voted against it.

The Triple Lock

If the triple lock proceeds again in April 2022, pensioners will receive state pension increases on the higher of:

• 2.5%.
• Consumer Prices Index (inflation) 3.1%.
• Earnings inflation 8.0%.

The government sough to avoid the 8% increase by offering only a double lock next year of 2.5% or 3.1%, removing the 8% earnings inflation link.

Lords Amendment

Baroness Altman, former Pensions Minister, put forward an amendment to make an adjustment to the earnings inflation benchmark to allow for the unusual and of course, extraordinary covid-19 lockdown economic bounce back.

Comment

The matter will be returned to the House of Commons for further consideration by MPs.  That said, when it comes to the country’s finances, it is not customary for the House of Commons to accept a negative vote from the House of Lords.  We suspect that after considering the proposed amendments, the double lock will still be made law given the conservative majority.