PM to end pension triple lock in 2030 to fund care service

Prime Minister Andy Burnham has announced plans to end the existing state pension triple lock from 2030, a move designed to generate significant savings for the funding of a new national care service in England. In his first speech as prime minister at the Labour Party conference, Burnham outlined a broader vision for transforming the country, which includes increasing public control over housing, water, and energy services. He stated that the proposed changes to the pension system would allow the state pension to continue rising by at least inflation or 2.5 per cent annually, while removing the automatic link to average earnings growth.

The prime minister addressed the financial challenges of his social care reforms, acknowledging that he may face a political price for implementing the changes. He argued that the current system forces some older people with only a state pension to pay for care from their limited income. Under the new plan, this would no longer happen, as the savings generated from adjusting the triple lock would be directed towards building a fully funded national care service. Burnham described this as a landmark policy, comparing its significance to the creation of the National Health Service. He noted that the triple lock was introduced in 2010 to ensure pension values kept pace with cost of living and earnings, but he believes it is now time to adjust the mechanism to meet new societal needs.

Officials have suggested that the proposed changes could save approximately £15 billion a year by 2040. However, Jonathan Cribb, deputy director at the Institute for Fiscal Studies, cautioned that savings are likely to be relatively small in the initial years before rising substantially over time. He further noted that the reform should not be expected to save enough to fund universal social care within the next parliament. The proposal has drawn criticism from various political figures and unions. Sharon Graham, general secretary of the Unite union, argued that the government should have considered alternative measures, such as a wealth tax, rather than altering the triple lock. Conservative leader Kemi Badenoch stated that tax rises are inevitable under the Labour plan, while Reform UK leader Nigel Farage accused the prime minister of launching an offensive against the elderly.

Beyond pension and care reforms, Burnham outlined several other policy initiatives during his hour-long address. He announced plans to repeal the ban on public ownership of water companies, a restriction he attributed to former prime minister Margaret Thatcher. Legislation will be introduced to Parliament to begin a ten-year journey towards a different water system, including new powers for mayors to hold companies to account. The prime minister also indicated that it would become easier for local councils to acquire private rented homes in poor condition if landlords fail to take action after receiving warnings. He stated that the government would change the law if necessary to achieve this goal.

Burnham also addressed the United Kingdom’s relationship with the European Union, stating that Brexit has done more harm than good. Ahead of talks expected later this year with EU chiefs, he said he would set out different options for Britain’s long-term relationship with the bloc, aiming to find consensus that provides clarity on the country’s position. In a move to cheers from the conference hall, the prime minister announced a national commission on electoral reform. This body will consider changes to the current voting system for parliamentary elections, with the government committing to contest the next election with a manifesto pledge to change the system so that every vote counts. He invited all political parties to contribute to the commission’s work, although Skills Minister Baroness Smith of Malvern responded by stating that electoral reform is not a top priority for her.

The speech also touched on education and welfare, with Burnham expressing a desire to rebuild a system of comprehensive education that ensures parity between academic and technical pathways. He called for a fundamental rethink of the welfare system to fund new opportunities for young people. The prime minister’s address was delivered to a packed hall, with family and friends in attendance. He paused at times, appearing to hold back tears as he referred to his late father, Roy, who died earlier this month. Arriving to the sound of the song All Together Now by The Farm, Burnham used the title as a theme, expressing his wish to draw a line on a decade of division and put the country on a new path. Green Party leader Zack Polanski criticised the speech, describing it as containing little more than half measures and tinkering.