Triple-lock on pensions will stay. Pensions will increase when earnings have decreased

[200sols]

So you would take the cash...thought so.

Typical from him. No argument to make so just the usual rubbish... 'strawman'.

 

[RandomMonkeH]

The point about temporarily abandoning the triple lock is that with covid and furlough that means pensioners will get an 18% increase this year and obvisouly since pensions never go down, that increase will remain in place for years.

Thats an extra £17bn cost next year alone for state pensions. Then another £17bn the following year plus whatever the triple lock adds onto it etc.

No Rishi wanted to drop the triple lock next year and make it a double lock to take account of the one off special circumstances of Covid. This has been overuled by Boris now and the triple lock stays for next year.

Either the triple lock stays and they get 18% rise or it is changed and they dont,. The article linked to says the decision ahs been made to not change them,.

That's not quite right.

Returning to a double lock that removes the 2.5% promise is predicted to save around 20 billion over five years (i.e. 4 billion a year), not 17 billion. Check the SMF figures.
The 18% is an artificial statistical spike - nobody is actually going to receive an 18% wage increase in real terms.

The triple lock is based on average earnings, and by tweaking how you average those earnings it will give a much lower figure. The government can do this quite easily and still retain their manifesto pledge.

The cynic in me tells me the 18% is a fishing trip to see if they could get away with a double lock and make the eventual lower increase more palatable to voters. My guess is < 3.9%

 

[Greebo]

That's not quite right.

Returning to a double lock that removes the 2.5% promise is predicted to save around 20 billion over five years (i.e. 4 billion a year), not 17 billion. Check the SMF figures.
The 18% is an artificial statistical spike - nobody is actually going to receive an 18% wage increase in real terms.

The triple lock is based on average earnings, and by tweaking how you average those earnings it will give a much lower figure. The government can do this quite easily and still retain their manifesto pledge.

The cynic in me tells me the 18% is a fishing trip to see if they could get away with a double lock and make the eventual lower increase more palatable to voters. My guess is < 3.9%

No it is exactly right. Rushi wanted to suspend the triple lock for one year to avoid the 18% rise. He has been overuled and the triple lock stays.

the average earnings is clearly defined as to what it is in the triple lock rules. What was the issue with suspending the triple lock to avoid the 18% anomaly?

 

[Jokester]

They would still need to change the law to enable other metrics to be used for average earnings.

It's possible that this still happens though, as they could change this and still maintain a commitment to the triple lock system.

 

[Surveyor]

They would still need to change the law to enable other metrics to be used for average earnings.

It's possible that this still happens though, as they could change this and still maintain a commitment to the triple lock system.

Which law would they have to change?

 

[HACO]

Don't worry, it will never happen. When you get older you will change your mind, that I guarantee.
There is nothing in socialism that a little age or a little money won't cure.

Not a socialist. Also, what a boomer thing to say, even if you’re not a boomer that’s a boomer’s logic

 

[Jokester]

Which law would they have to change?

https://researchbriefings.files.parliament.uk/documents/CBP-7812/CBP-7812.pdf

The statutory requirement is to uprate the bSP and nSP every year at least in line with earnings. The ‘triple lock’ is a Government commitment over and above this statutory requirement, to uprate the bSP and nSP by the highest of earnings, prices or 2.5%. It does not apply to other elements of the State Pension – such as the State Second Pension or ‘deferred retirement increments’ (extra amounts earned by deferring a claim for the State Pension).

It's a statutory requirement to increase the pension in line with earnings (the triple lock was to guarantee it was always at least 2.5% even when earnings increase was less than this) - Social Security Administration Act 1992

As regards earnings, legislation allows the Secretary of State for Work and Pensions to estimate the annual change in the “general level of earnings in such manner as he thinks fit.”Although the Coalition did not initially specify what measure of earnings would be used in the triple lock, it confirmed in December 2012 that it had used the increase in average weekly earnings to July, and this measure has continued to be used since then.

Though seemingly there is some wiggle room in what they use for that value, I don't think they can just ignore it for a year.

 

[Surveyor]

https://researchbriefings.files.parliament.uk/documents/CBP-7812/CBP-7812.pdf

There's no need for any change in the law.

From the Act:

(2) Where it appears to the Secretary of State that the general level of earnings is greater at the end of the period under review than it was at the beginning of thatperiod, he shall lay before Parliament the draft of an order which increases each of the amounts referred to in subsection (1) above by a percentage not less than the percentage by which the general level of earnings is greater at the end of the period than it was at the beginning.

Subsection (1) includes the basic pension.

(8) For the purposes of any review under subsection (1) above the Secretary of State shall estimate the general level of earnings in such manner as he thinks fit.

The general level of earnings can already be calculated in whatever manner the government chooses.

 

[Outcast440]

Maybe if younger people bothered to vote (although I can't blame them when all choices are equally terrible) then parties currently holding the power wouldn't make strategic moves like this in order to gain favour with the larger portion of voters

funny, I've never actually seen an 'Anti-Triple Lock Pension Party'

guess it's the young'uns fault then for not voting for it

 

[Jokester]

The general level of earnings can already be calculated in whatever manner the government chooses.

The government can't just ignore an 18% increase in average earnings, they'll get taken to court and would need to have a very robust argument for choosing something that doesn't reflect reality!

 

[Outcast440]

I don't see why younger generations keep scapegoating older generations for everything, most of the policies that have lead to the situation we find ourselves in today are supported wholeheartedly by those naive younger generations. Older generations voted Brexit to try to curb mass unlimited immigration that drives down wages and drives up house/rent prices and how did youth react? we got the entirety of the younger generations protesting and calling them racists, demanding another referendum and the voting age be lowered so they can get their own way.

It's because most young people still believe in all that Brotherhood of Man stuff, you know, like we're all just buddies and can't we just get along etc.

 

[Surveyor]

The government can't just ignore an 18% increase in average earnings, they'll get taken to court and would need to have a very robust argument for choosing something that doesn't reflect reality!

It would seem reasonable to factor out the effect of a global pandemic and furlough pay as their effect is not a true reflection of the general level of earnings.

 

[Outcast440]

can't see why the pensioners should now be getting a protected triple lock, whilst everyone else is getting stiffed?

 

[deuse]

can't see why the pensioners should now be getting a protected triple lock, whilst everyone else is getting stiffed?

Who's every one?

 

[Jokester]

It would seem reasonable to factor out the effect of a global pandemic and furlough pay as their effect is not a true reflection of the general level of earnings.

Yes, it seems reasonable to ignore it but I believe the law doesn't allow them to do that - peoples average earnings will be down ~18% this year and they would (hopefully, but I doubt it) increase by 18% again next year. It would be open to legal challenge if the Secretary for State decides that it is inconvient to use actual average earnings in their decision.

 

[Greebo]

It would seem reasonable to factor out the effect of a global pandemic and furlough pay as their effect is not a true reflection of the general level of earnings.

Or just drop the average earnings bit for one year as Rishi suggested they did?

 

[Surveyor]

Yes, it seems reasonable to ignore it but I believe the law doesn't allow them to do that - peoples average earnings will be down ~18% this year and they would (hopefully, but I doubt it) increase by 18% again next year. It would be open to legal challenge if the Secretary for State decides that it is inconvient to use actual average earnings in their decision.

I'm not aware of any law on how the general level of earnings is to be calculated. The Secretary of State can do it in any manner they think fit. They may think it fit to exclude the effect of a global pandemic and fulough pay as exceptional events.

Or just drop the average earnings bit for one year as Rishi suggested they did?

That would require a change in the law as the only part of the triple lock enshrined in law is the link to the general level of earnings.

 

[Jokester]

I'm not aware of any law on how the general level of earnings is to be calculated. The Secretary of State can do it in any manner they think fit. They may think it fit to exclude the effect of a global pandemic and fulough pay as exceptional events.

Indeed, but the law requires the method used to determine the earnings increase over the specifc period, there would be an absolute increase in earnings no matter how they measure it - they can't just ignore it on the basis of the pandemic.

 

[Surveyor]

Indeed, but the law requires the method used to determine the earnings increase over the specifc period, there would be an absolute increase in earnings no matter how they measure it - they can't just ignore it on the basis of the pandemic.

I'm sure it could be reasonably argued that earning £3k/month, down to £2.5k/month on furlough and then up to £3k/month going back to work isn't representative of the change in the general level of earnings.

 

[Greebo]

I'm not aware of any law on how the general level of earnings is to be calculated. The Secretary of State can do it in any manner they think fit. They may think it fit to exclude the effect of a global pandemic and fulough pay as exceptional events.



That would require a change in the law as the only part of the triple lock enshrined in law is the link to the general level of earnings.

which is fine and is what Rishi proposed. Now that has been overuled and we are back to it being enshrined in law again