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Spending commitment

Johnson says pensions triple lock ‘will be retained’

pension pot

Changes to pensions are being considered

Boris Johnson is committed to retaining the “triple lock” on pensions, despite reports that the government wants to scrap the commitment.

The promise to annually increase pensions by the highest of the consumer price index (CPI), wage growth, or 2.5%, will stay in place, according to Downing Street sources.

Average wages are said to be racing ahead in part because of anomalies created by the pandemic, with economists projected wage growth to rise to about 8% by July.

This would leave the Treasury looking for £4 billion in added annual costs of financing future pensions – hence calls to suspend the current formula or increase in tax on pensions.

Mr Johnson and Chancellor Rishi Sunak are said to be divided on the sway forward.

One reported proposal under consideration is to cut the pensions lifetime allowance from £1,073,100 to around £800,000.

The government is committed to not increasing income tax.

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