The Triple Lock Guarantee is a safeguard introduced by the UK government to ensure that the State Pension remains financially viable for pensioners. It is a system of three measures that decide how much the state pension will rise each year, and its primary aim is to protect the state pension from inflation and ensure that it rises by a real and tangible amount each year. The three-way guarantee means that each year, the state pension would increase by the highest of the following three measures:
- Average earnings
- Inflation as measured by the Consumer Price Index (CPI)
- 2.5%
If average earnings or inflation rises by over 2.5%, the state pension will still grow by this amount. The Triple Lock Guarantee ensures that pensioners are not left behind as the nation’s earnings rise. If you are currently receiving the state pension, the Triple Lock Guarantee ensures that your spending power will not diminish over the course of your retirement (for as long as all three guarantees remain in place) . The Triple Lock Guarantee was introduced in 2010 by the coalition government led by then Prime Minister David Cameron. It has been suspended for the 2022-23 tax year, but the government has confirmed that it will be reinstated.
