Both the Express and the i newspapers lead today with the story that the way the state pension rises each year is now under threat.
You may have heard of 'the triple lock'.
This triple lock determines how much the state pension rises each year. Which ever is the highest of the following three criteria determines how much the pension gets raised;
a) average wage increases
To keep the above mechanism was part of the Conservative Party manifesto in last December's general election.
Now it is being mooted that because of the impact of Covid 19 on the nation's finances, the nation cannot afford to keep raising state pensions in the way shown above given as the economy is now up a creek without a paddle with the possibility of millions being made unemployed once the furlough scheme ends.
I seem to remember Theresa May threatening this in the 2017 election (along with the "dementia tax"). She called the election fully expecting to romp home against Jeremy Corbyn's commissars, but a hung parliament was the result instead. Much was said at the time that the Tories lost what was referred to as "the grey vote" because of this, which was a significant factor in May's failure to secure an overall majority. The proposed changes to increases in state pension and the dementia tax were never mentioned again after the election to my knowledge.
My thoughts there are those on state pension who struggle from month to month and then there are those who have good public or private pensions who are sitting in clover so maybe we should means test all pensioners and those who need it get it and those who are sitting in clover dont. So looking at my own situation i am certainly not sitting in clover but would not miss a state pension rise for 3 or 4 years we will all have to tighten our belts but those who need it most should get it.
Leatash, this then asks the question, is there a difference between those that have earnt good money and spent it and those who also earned good money and have saved it. Those that saved for a pension and those that did not. I agree we must all tighten our belts but means testing for the OAPension is not right
And yet there are plenty who never had the opportunity to save or buy a house but have worked hard all there lives.
As is pointed out in the article below (see link) the UK state pension is presently based on the National Insurance contributions of an individual not that individual's wealth.
If the government were to suddenly make it means tested wouldn't that be moving the goal posts just a tad too far? The goal posts have already been moved remember by the raising of the state pension age (now 66 years). And the state pension age is likely to rise again in the near future.
Have a read of the article here and the comments below it - interesting read.
Article here by Baroness Altmann, a Tory peer and one time Pensions Minister, on why the 2.5% bit of the triple lock should be 'revisited'.
At one point she quotes the full state pension amount for those in receipt of the state pension since 6.4.2016. Just to point out that you only get that amount if 1) you have 36 years worth of the right type of NI contributions because 2) if, for example, you have 36 years worth of NI contributions but you have reduced the amount you pay into NI because you are contributing/have contributed to a private pension, then the amount of state pension you are entitled to is reduced accordingly.