Charlie Oakham
2 minutes length
Posted: 1st August 2016

Theresa May: Government Will Keep 'Triple Lock' on Pensions

The Government resists calls by former Pensions Minister Baroness Altmann to scrap the triple lock on state pensions, despite warnings of high costs.

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Prime Minister Theresa May has reassured savers that the so-called triple lock, which protests state pensions, will remain in place – despite calls by former Pensions Minister Ros Altmann that the scheme could lead to ‘enormous costs’.

The pension’s triple lock guarantees that state payments will rise by either the inflation rate, average earnings, or a 2.5% safety net, whichever is highest. Baroness Altmann’s suggestion was that a ‘double lock’ could still provide savers with adequate protection, whilst saving the Government billions of pounds.

Baroness Altmann suggested that state pensions should increase in line with prices or earnings, claiming the 2.5% rise “really isn’t a sensible policy as far as long-term policy making is concerned.”

She called on the Government to focus on the long term, rather than “knee-jerk, headline, totemic policies”, which she claimed “end up staying forever because nobody has got the courage” to revisit the issue.

“The double lock would still give pensioners much better protection than most other areas of the economy,” she said.

“It is absolutely right that we must protect pensioners, and we should look at a double lock as the best way for the long term to really achieve that.”

A spokesperson for the Prime Minister said: “The manifesto contains a commitment to protect the triple lock. That commitment still stands.”

The Changing Face of Pensions

Pensions have undergone vast changes in recent years, with the triple lock introduced in 2010, and the Workplace Pension Reforms coming into force in 2012.

With all of the changes in legislation happening, and more planned for the near future, i.e. holiday pay, many businesses are choosing to outsource their payroll. The Chartered Institute of Payroll Professionals annual payslip statistics comparison report found that the rise in businesses outsourcing their payroll is likely the result of new and upcoming legislation, and also the added administrative burdens they bring.

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Outsourcing payroll enables you to remove the time constraints of payroll and lets you focus on running your business. Check out our handy payroll outsourcing calculator to see how much your business could save, or use the button below to request a call back to discuss the IRIS Managed Payroll Service.

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