ONS pay data strengthens case for scrapping the pension ‘triple lock’, says IEA expert
Alexander Hammond features in Daily Express
Alexander Hammond quoted in Estate Agent Today
Commenting on the ONS UK labour market figures for August 2021, published today, Julian Jessop, Economics Fellow at free market think tank the Institute of Economic Affairs, said:
“The continued strong recovery in employment and growing evidence of labour shortages adds to the case for winding down the furlough scheme. Indeed, this scheme may now be doing more harm in some sectors than good. Job vacancies are already well above pre-Covid levels and people should be encouraged to return to normal work, or move on.
“The 8.8 per cent jump in average pay in the three months to June provides more ammunition for those arguing that the ‘triple lock’ on the state pension needs to be unpicked. The July figure, which would normally determine the pension increase next April, is now also likely to be well above 8 per cent.
“Each one percentage point increase in earnings growth will add around £900 million to annual spending on state pensions, next year and in future years.
“The pay data have been distorted by the pandemic in ways that no-one could have anticipated. Unless the triple lock is changed, this will provide an unintended windfall to pensioners that is increasingly hard to justify.”
Notes to editors
Contact: Emily Carver, Head of Media, 07715 942 731
IEA spokespeople are available for interview and further comment.