Is it true that all political careers end in failure? I can imagine one scenario where they don’t. If I were Rachel Reeves, I would stop trying to appease my unofficial masters — the right-wing press, the OBR, Osborne’s Imperius curse, the bleeding heart Labour base. Instead, I would make my peace with being a one-term Chancellor and kill all the bloated and diseased yet nonetheless sacred cows infesting our political consciousness. One such is the triple lock.
Robert Carville in the Times called it our “Snorgoth” — a terrible God that we have to sacrifice our newborns to. Any heretic who has dared to suggest we resist, like Pensions Minister Torsten Bell did in his pre-election role in the Resolution Foundation, is immediately disciplined, before the beast that guards it (i.e. the pensioners who still reliably buy newspapers, watch TV and mail in their ballot papers) awaken.
My family-oriented Greek upbringing makes me moderate my tone when talking to older people. Still, something about the glee with which boomers online attacked the working young — people who won’t ever see comparable pension rates, even if they are fortunate enough to retire — after I suggested that we replace the triple lock with a double lock triggered the millennial snowflake in me.
I’ve worked for MPs, so I know it is electoral suicide, in an ageing population, to touch the booby traps that successive Tory governments have laid in the Treasury coffers. But my interactions with the online boomerati have convinced me that many people do not understand what the triple lock is and what reforming it would mean.
For one thing, UK pensions are average by international standards. Most pensioners today are not in poverty; many are comparatively affluent, especially in terms of housing wealth. Over two-thirds of pensioners have income from private pensions or investments on top of the state pension. Meanwhile, younger households with children have higher poverty rates — yet their benefits have not kept up or have been cut.
The triple lock can overshoot reality
The state pension’s triple lock is an international outlier: it guarantees annual pension increases by the highest of inflation, wage growth or 2.5 per cent. How many people know that the 2.5 per cent is a random number? No other major economy does anything comparable. The Lib Dems came up with it in the same manifesto in which they promised to scrap tuition fees. The Tories duly adopted it amidst the coalition years, tripled student fees and were rewarded for their bribe with a majority at the next elections. Finally free of their yellow fever, Cameron and Osborne had the good grace to shield the electoral royalty from the austerity they unleashed on the working young.
We had a glimpse of how the triple lock’s ratchet can create outsized jumps during the COVID-19 pandemic. Average earnings initially fell, then rebounded sharply. Had the triple lock not been temporarily suspended, the state pension would have first risen by its 2.5 per cent floor (during the wage dip) and then by over 18 per cent the following year when earnings growth peaked, a compounded 21 per cent increase over two years. Such a spike would have been an enormous windfall for pensioners at a time when working taxpayers were struggling — and would have permanently locked in a much higher pension base. The government averted this by suspending the earnings element for one year, but that ad-hoc fix proved the point: the triple lock can overshoot reality, forcing large payouts unrelated to underlying economic growth. Even in more normal times, the 2.5 per cent floor has kicked in during periods of low inflation/wage growth (for instance, in 2015 and 2016) — effectively giving pensioners a raise whilst working families saw stagnation.
Perhaps if the burden of these austerity measures did not fall so disproportionally to the smaller (relative to the older generations) voting classes, they wouldn’t have been so keen to reward with a majority a political party that, at times of low interest rates, failed to invest in the public services and infrastructure that we are squeezing the working young to patch up now.
I am a social democrat who wants everyone to be better off. Plus, I have learned from cancel culture that the Oppression Olympics — where we set one group of vulnerable interests against another — brings out the worst in all of us and leaves the real culprits guilt-free. But even in my most fully automatic luxury communism dreams, I wouldn’t create a benefit that increases annually by an arbitrary per centage, in perpetuity.
In its latest Fiscal Sustainability Report, the OBR projects state pension spending to rise from about 5.1 per cent of GDP today to roughly 8.6 per cent of GDP by the early 2070s if the triple lock continues. In other words, nearly £1 in every £12 of national income would be consumed by state pensions alone.
Pensioners do not need to keep sprinting ahead of the rest of us
Unless we intervene, there is no defined end goal for pension adequacy under the triple lock — it will keep boosting pensions faster than the rest of the economy indefinitely. I believe left-wing people who deify the triple lock have failed to grasp its full preposterousness. Anyone right-wing still supporting it is doing it out of pure self-interest and should fess up to it.
“Growth” has become a battle cry for disillusioned millennials of all ideological stripes, who have woken up to our shared immiseration on issues like housing. It may feel tasteless to inflame intergenerational animosity, not least because the problem will be most pronounced within social classes once the wealth transfer of the “haves” class is complete and the “have nots” realise that no, we were not all in this together.
But remember this: we needed the YIMBY movement to force politicians to acknowledge that the home-owning generations were protected from the horror of the housing crisis and personally benefited from making the situation worse for the rest of us. Equally, we must remember that many pensioners are sheltered from stagnating wages and inflation. Just as the economy was undergoing pseudo-growth from rising rents, pensioners’ living standards are artificially rising thanks to the triple lock. The rest of society is in decline, and the old cannot understand why the young revolt against pitiful salaries and deteriorating living conditions. Pensioners should keep up with working people, and a double lock would ensure that, but they do not need to keep sprinting ahead of the rest of us.
Someone has to make a change, and Labour has a healthy majority with which to pull it off. Yes, the Conservatives — who promised a “quadruple” lock at the last election — Reform, the Lib Dems and maybe even the Greens will fight back like Maoists. Yes, there will be a GBNews dispatch to Grimsby asking Poppy and Paddy whether our money is best spent on keeping grannies warm or on Cadillacs for dyslexic they/thems. Yes, they will say you are “cutting” state pensions, as Angus Robertson accused Theresa May of doing in 2017, when all you are doing is increasing it by inflation and average wages, rather than an arbitrary number.
They will only be confirming they are political lightweights, unfit for government and complicit in the demographic time bomb that’s landed on our lap. But I have hope. There are reports that Zoomers don’t know how to read, but we may soon ban Generation Alpha from their screens. Maybe then, with their newfound literacy, they will read this and, for once, get out and vote.
