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Steve Webb: MoneyWeek Talks
While the rising cost of the triple lock policy has stirred controversy, Steve Webb, who was pensions minister when it was introduced, argues the triple lock is vital. Webb spoke to Kalpana Fitzpatrick on the MoneyWeek Talks podcast – out now.
The state pension triple lock is estimated to cost the government around £15.5 billion by 2030, putting the policy under intense pressure with many industry experts calling for it to be scrapped. From April 2026, pensioners will get an above-inflation state pension boost of 4.8%, thanks to the triple lock.
The mechanism is considered generous and expensive. For a desperate chancellor, Rachel Reeves, who needs to plug an estimated £20 billion deficit, removing the triple lock could be an easy way to free up cash.
But Steve Webb, who was the pensions minister when the triple lock was introduced in 2012 under the Conservative–Liberal Democrat coalition government, argues that it helps tackle pensioner poverty and it is right that the policy stays put.
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The triple lock is there to do a job. I’m not embarrassed or ashamed of it
Steve Webb
Speaking on the latest episode of MoneyWeek Talks – which can be watched on YouTube or downloaded on any podcast platform – Webb says: “I became pensions minister in 2010. But in the previous 30 years, the state pension had been falling in value relative to what people earn, so it just went up with inflation most of the time.
“But the problem with that is if you earn and earn and then stop earning, then the thing you fall onto when you stop earning needs to be connected to some proportion of what you were earning. Otherwise, you just fall off a cliff and your standard of living crashes. So, the state pension needs to be pegged to a proportion of what people are earning and for 30 years, [prior to the triple lock] that had not happened.”
Webb, who is now a partner at consulting firm LCP, argued that before the triple lock, the state pension was getting worse relative to what people were used to before they retired.
“So, the point of more generous indexation post 2010 was to undo 30 years of damage.
“I’m not embarrassed or ashamed; I am proud of the fact that the state pension has been over-indexed, so we link it now to the best of growth in wages, growth in prices or 2.5%. This has nudged up the state pension a bit, relative to the average wage.”
The UK state pension is the least generous in the G7 group of the world's most advanced economies, with UK retirees receiving around 22% of average earnings from the state pension, much lower than continental neighbour France (with 58%) and Italy (76%). Webb says he does not think the triple lock system will last forever, but for now, it is there to do a job.
The triple lock: a boost for pensioners
In April 2026, 13 million pensioners will benefit from an above-inflation rise to the state pension, thanks to the triple lock. For those getting the full new state pension, it’s worth £550 a year. The increase is an extra £120 compared to what it would have been if it had been uprated by inflation only.
The rate of the full new state pension is expected to increase to just over £240 a week.
The full basic state pension is set to rise by around an extra £440 a year.
“There is an argument that the triple lock is a sop to the grey vote, this is all about older people, and that young people should not have to pay for this, but they [young people] need a good state pension, don’t they?” Webb says on the podcast.
In a report earlier this year, the Office for Budget Responsibility pointed out that public finances are exposed to inflation shocks and earnings growth – that, with an aging population, means state pension spending, after health, was the second-largest source of upward pressure on government spending.
Labour has so far pledged not to touch the triple lock in this Parliament, but its future could still be at risk in the coming years. Plus, we have seen many U-turns on policies from Labour, raising fears the triple lock could well one day be on the cards as Reeves continues to face cost pressure.
In case you missed it, the first podcast episode of MoneyWeek Talks with Rishi Sunak is also available to watch or listen to now.
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