How the triple lockdown made a generation of pensioners more dependent on the state


“Some people depend on the state pension because they just don’t have any savings,” says Kate Smith, pensions manager at Aegon.

“We can’t really expect the state to pay more on top of the state pension more than it already does, like the pension credit,” she says.

“There are very clear messages from this government, [and] really from previous governments, that it is up to individuals to save for themselves with their employer. That’s why we have automatic registration.

Introduced in 2010, the triple lock ensures that pension payments – and the government bill – rise at the peak of average income growth, inflation or 2.5% each year.

However, the policy has been pushed to its limits in recent years as an aging population begins to strain public finances.

Experts warn that Britons are overly dependent on the state for their pensions and not enough on their own savings despite the self-enrollment revolution.

“Right now, 70% of single retirees receive more than half of their income from state pensions,” says Daniela Silcock, head of policy research at the Pensions Policy Institute.

“This year prices have gone up, which is going to have a really fundamental effect on what retirees can buy. If we don’t see pensions rising as much, then pensioners at very low levels will start to struggle.

She says more can be done through taxes to encourage people to save, especially for those on lower incomes.

But the triple lockdown has become politically almost impossible to remove as many now rely on the state pension to survive after not saving enough for retirement.

A new full state pension is worth just under £10,000, but experts estimate Britons need around two-thirds of their working income for retirement, meaning a huge shortfall for a lot.

Auto-enrollment – which was introduced in 2012 – has been hailed for boosting worker savings, requiring employees and employers to set aside at least 8% of their earnings. Participation in pensions has risen from 47% of employees to 79%, or some 22 million people. But experts say that’s not enough.


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