Dr Martin Heneghan and Professor Liam Foster examine the Prime Minister, Andy Burnham’s recent announcement about ending the state pension triple lock to build a National Care Service if the party wins the next election.
On 29 September 2026, Labour’s recently anointed prime minister, Andy Burnham, indicated the ‘triple lock’ on pensions would be amended in the next parliamentary term to help to fund a new National Care Service. In this commentary, we set out what the triple lock is, the implications of ending it and whether this is the best approach to funding improved social care provision. We argue that, whilst the triple lock cannot remain in place indefinitely, ending it at the beginning of the next Parliament would disproportionately affect poorer pensioners. We propose that, while the prospect of a National Care Service represents an important step forward in the social care debate, additional funding for social care should instead involve taxing the income and wealth of more affluent pensioners, alongside broader tax reforms.
In a previous blog before the 2024 election, we wrote that it was unsurprising the major parties were continuing the triple lock because “pensioners have a higher propensity to vote than the rest of the population. This means any political party hoping to win an election must think about pensioners’ interests carefully”. It is therefore perhaps somewhat surprising that prime minister Burnham has indicated he intends to end the triple lock by 2030. At the same time, the social care system is severely underfunded and faces a workforce shortage, whilst 1 in 7 spend over £100,000 of their own money on care. Previous governments have continually pulled back on reforms because the extra funding inevitably involves trade-offs or tax rises. Burnham should be commended for grasping the nettle, but is this the right choice?
Falling pensioner poverty
Evidence suggests that many pensioners have done relatively well in recent decades compared to other groups in society For instance, the Joseph Rowntree Foundation estimates that in 1994, 28 percent of pensioners lived in relative poverty, whilst 32 percent of children did. By 2024, the poverty rate for children remained at 30.5 percent, but for pensioners it had fallen to less than 16 percent. With 21 percent of the population living in relative poverty, pensioners are now less likely than the rest of the population to be poor.
Pensioner poverty fell significantly because of measures introduced by the 1997 New Labour government, before the triple lock. In particular, the introduction of pension credit in 2003 led to a significant fall in the number of pensioners living in poverty. The triple lock’s role is therefore partly to maintain the adequacy reached in those years and prevent the state pension from falling behind earnings. However, it has also increased the generosity of the state pension over time, from a low of 16 percent of average earnings before its introduction to roughly 30 percent now. Many pensioners also draw income from occupational and private pensions, savings, and have accumulated housing wealth. These additional resources help explain why pensioners as a group have become wealthier, although they are unevenly distributed.
The triple lock
The triple lock is an adjustment mechanism that ensures the state pension increases every year by whichever is greatest: the rate of increase in prices, earnings or 2.5 percent. In the 1980s, the link between the state pension and earnings was ended and pensions were indexed to prices. This protected pensioner spending power against inflation. However, as earnings rose faster than prices, pensioners fell behind the rest of the population and did not share in the country’s rising prosperity.
A low point of indexing pensions to prices came in 2000, when inflation was so low that the state pension increased by only 75p per week, a politically unpopular outcome. Reinstating the link with earnings helps prevent pensioners from falling further behind, whilst the 2.5 percent floor guarantees an increase even when earnings and prices are relatively flat. Together, these provisions protect pension incomes, but also create problems for future spending.
The ratchet effect uncertainty and unintended consequences
The triple lock should be commended for making the state pension more generous. Often missing from debates is the fact that the UK state pension is one of the least generous in the OECD. Whilst pension spending is projected to increase with rising longevity, UK spending will still be lower than in most advanced economies.
However, there are valid criticisms of its design. The macroeconomic environment can lead to pensions increasing by more than the spirit of the triple lock intended. During the pandemic, inflation fell to 0.5 percent because of suppressed aggregate demand. This was linked to lockdowns and closures, lower corporate spending, and people staying at home, spending less money, and saving more in case of job losses. Earnings data were uncertain given the number of workers on furlough, so pensions increased by 2.5 percent, a real-terms increase of around 2 percent. When furlough was unwound and lockdown ended, earnings experienced a temporary statistical rebound of 8.4 percent. The earnings element of the triple lock was suspended because this increase would have followed its letter but not its spirit, a politically unpopular move. Nevertheless, the state pension was uprated by 3.1 percent and then 10.1 percent the following year, reflecting the high inflation that followed the pandemic and the supply shock of the Ukraine war.
Other economic conditions could also produce unintended consequences. Whilst supply disruptions continue to cause inflation, it is possible that the AI revolution could contribute to a sustained period of deflation, with both prices and earnings falling. In this scenario, annual increases of 2.5 percent would represent substantial real-terms gains for pensioners.
These increases are built into the pension’s future value rather than reversed when economic conditions change. This is the ratchet effect: the pension can rise relative to both prices and earnings over time, depending on which measure determines each annual increase. In a high-inflation environment with real earnings falling, the burden on the working-age population can become greater. The triple lock therefore generates uncertainty about future pension spending as well as increasing generosity. These design problems make eventual reform necessary, but do not settle when it should happen or how social care should be funded.
Should the triple lock be ended to fund social care?
The idea put forward at the Labour conference was that the triple lock would end in April 2030, if they won the next election, instead pensions would increase by the greater of prices or 2.5 percent, with a further mechanism to ensure they never fell too far behind earnings. This means that pensions could rise more slowly than under the current rules in some years, while retaining protection against inflation. There is a strong case that the triple lock cannot continue indefinitely. As we have shown, its ratchet effect creates uncertainty over future pension spending and can produce arbitrary increases in the value of the state pension depending on movements in prices and earnings. But accepting that the triple lock will eventually need reform is different from concluding that ending it now is the best way to fund social care.
The central problem is the enormous variation in the financial circumstances of pensioners. The charity independent age estimate 13 percent of pensioners and 18 percent of single pensioners rely on the state pension as their sole source of income. They would bear the brunt of a less generous uprating mechanism. Wealthier pensioners, by contrast, are much more likely to have occupational and private pensions alongside housing and other forms of wealth. Ending the triple lock therefore targets the state pension rather than the pensioners with the greatest capacity to contribute. Indeed, Centre for Care research has shown that among those groups most likely to be reliant on the state pension include social care workers.
This distinction is likely to remain important for some time. Automatic enrolment is a legal system where employers must automatically sign eligible staff up for an occupational pension and contribute money toward their retirement savings, though employees can choose to opt out. However, despite being introduced from 2012, employer and employee contributions remain below the levels generally considered necessary to generate sufficient income in retirement. For many future pensioners, the state pension will consequently remain a crucial component of retirement income.
There is also a more fundamental problem with linking reform of the triple lock directly to funding social care. The uncertainty generated by the triple lock means that estimates of future savings vary substantially depending on assumptions about inflation and earnings. It is therefore an unstable basis on which to fund a permanent expansion of social care provision. Indeed the Institute for Fiscal Studies modelling has identified that proposed changes to the triple lock would be insufficient to fund social care.
The proposed new underlying model represents a clear trade-off. It means moderating future pension growth after 2030 to establish collective insurance against social care costs. Therefore, whether an individual gains or loses overall depends, not only on the performance of state pensions, but also on their health outcomes and whether they ever need long-term social care.
A better approach would be to separate the two questions. The triple lock should eventually be replaced with a more sustainable mechanism that protects the state pension relative to earnings without producing an indefinite ratchet effect. But reforming the triple lock should not be treated primarily as a revenue-raising measure. If the government wants affluent pensioners to make a greater contribution towards a National Care Service, it should target their ability to pay more directly. Higher taxation of pension income and reforms to the taxation of accumulated wealth would raise more from affluent pensioners while protecting those reliant on the state pension.
The success of the triple lock in improving pensioner incomes should not obscure the fact that pensioners are not a homogeneous group. The challenge is therefore not simply to shift resources away from pensioners towards social care, but to raise them from those pensioners, and others in society, most able to contribute. The triple lock cannot last forever but now is not the time to end it to fund social care. Instead, a new National Care Service must be funded by a fair, sustainable and predictable national funding model which protects individuals from catastrophic costs.