STATE PENSION PREDICTED TO RISE AS THE COVID-19 OUTBREAK PUTS THE TREASURY IN TIGHT POSITIONS

Keeping to their promise in the Conservative manifesto which is for a tenured duration of five years of the parliament, the government makes use of a system referred to as the triple lock in the computing and payment of the state pension.
The triple lock which consists of the Consumer Price Index measure of inflation, the rising average wage or two and half percent portray the rising cost of living. Currently, the state pension increases annually at the same level with the increasing cost of living shown by the triple lock.
The government however could be dealing with a large increase in the state pension if they stick to the triple lock system. The wages paid by the state due to the coronavirus pandemic technically causes a rise in cost of living which translates to increased state pension.
THE TRIPLE LOCK
Since April, the new state pension has added up to one hundred and seventy five pounds weekly. The prior state pension which is one hundred and thirty four pounds weekly is still paid to most pensioners. There is a possibility these pensioners may get a credit increase.
The recent and old pensions paid by the state both increased to almost four percent.
This increase was as a result of the increase in the average earnings which is one of the factors in the triple lock. The average earnings was higher than the CPI inflation and the two and a half percent. This data was culled from the government’s official data between May to July.
As the year concludes, the government stipulates the amount of state pension that will be paid in the new-year starting from next April.
THE DEBATE AROUND THE TRIPLE LOCK
For the past decade, the triple lock has been used to decide the amount of state-paid pension.
The triple lock system was birthed by an alliance between the Conservatives and Liberals. The alliance was to make certain that the pensioners did not have too little pension to match their increasing cost of living.
Apparently, it is a policy that is exorbitant.
The policy has become the source of a debate since its introduction. It has torn people into two points of views with economists arguing against the triple lock since it sees the pensioners earning more yearly than the active younger workers since the financial crisis. They consider this to be unfair.
On the other side of the divide, charities that stand for the pensioners are of the opinion that the pension is still a little amount for the elderlies to survive on and it is comparatively small on the international scale.
HOW THE PANDEMIC AFFECTS THE TRIPLE LOCK POLICY
The coronavirus pandemic has put more pressure on the government financially. The government has to support citizens as they are not working and earning.
Average earning is bound to increase when people start working again and they begin to earn full incomes again. This would mean that according to the triple lock state pension would have to increase by eighteen percent which is the expected increase of average earnings.
It is expected that the debates will linger and maybe the authorities will re-evaluate the triple lock policy.