Rishi Sunak to guarantee pensions triple lock at next election

Published

8 months ago

March 21, 2024

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Rishi Sunak will guarantee that the pensions triple lock will remain in place under a future Conservative government, Sky News understands.

The costly policy came under fresh scrutiny after Chancellor Jeremy Hunt warned this week that improved economic growth and public sector spending cuts might be needed to sustain it.

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However, a Treasury source said the Tories – which introduced the triple lock in 2010 – will stick with it when the nation goes to the polls.

The triple lock is a government promise to raise state pensions every year by the level of average earnings, inflation or 2.5% – whichever is the highest.

It was designed to ensure people’s pensions are not impacted by gradual rises in the cost of living over time – but an ageing population and soaring inflation has raised questions about its long-term affordability.

A recent report by the Institute for Fiscal Studies (IFS) said the triple lock added an extra £11bn a year to public spending.

Asked about the sustainability of the triple lock and the pension age, Mr Hunt told the Lords Economic Affairs Committee on Tuesday that both of those things are “kept under review”.

He added: “The answer is very contingent on how successful we are.

“If we are able to run public services more efficiently, if we are able to increase our long-term growth rate, then it is entirely possible we can continue to have the levels of public provision we currently have, and the support for pensioners, and I very much hope that is the case.

“We are confident we can continue to support pensioners in the way we have been in the past.”

The comments sparked concern that the future of the triple lock was under threat.

But speaking to the Express, which first reported on plans to keep the policy, Mr Hunt said: “I am totally committed to the triple lock, which is increasing the state pension by 8.5% next month – worth £900. Our track record is clear: we stand square behind Britain’s pensioners.”

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The general election, expected in the second half of this year, will be heavily fought on the economy.

Both the chancellor and his Labour counterpart Rachel Reeves have set out strict fiscal rules on public spending.

It has been reported that Labour will also commit to the triple lock in its election manifesto.

Any backtrack on the policy would be politically risky, given the UK’s state pension provision is lower than most other advanced economies and warnings about rising pensioner poverty.

However, critics say that on top of its unsustainable cost, it contributes to inter-generational unfairness.

Politics

Coinbase CEO to meet with Trump to discuss personnel appointments — WSJ

Published

5 hours ago

November 18, 2024

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Coinbase CEO to meet with Trump to discuss personnel appointments — WSJ

Before US Election Day, Brian Armstrong said Coinbase was “prepared to work” with either a Kamala Harris or Donald Trump administration.

Politics

Row over how many farms will be affected by inheritance tax policy – as PM doubles down ahead of farmers protest

Published

6 hours ago

November 18, 2024

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Row over how many farms will be affected by inheritance tax policy - as PM doubles down ahead of farmers protest

Sir Keir Starmer has insisted the “vast majority of farmers” will not be affected by changes to Inheritance Tax (IHT) ahead of a protest outside parliament on Tuesday.

It follows Chancellor Rachel Reeves announcing a 20% inheritance tax that will apply to farms worth more than £1m from April 2026, where they were previously exempt.

But the prime minister looked to quell fears as he resisted calls to change course.

Speaking from the G20 summit in Brazil, he said: “If you take a typical case of a couple wanting to pass a family farm down to one of their children, which would be a very typical example, with all of the thresholds in place, that’s £3m before any inheritance tax is paid.”

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The comments come as thousands of farmers, including celebrity farmer Jeremy Clarkson, are due to descend on Whitehall on Tuesday to protest the change.

And 1,800 more will take part in a “mass lobby” where members of the National Farmers’ Union (NFU) will meet their MPs in parliament to urge them to ask Ms Reeves to reconsider the policy.

Speaking to broadcasters, Sir Keir insisted the government is supportive of farmers, pointing to a £5bn investment announced for them in the budget.

He said: “I’m confident that the vast majority of farms and farmers will not be affected at all by that aspect of the budget.

“They will be affected by the £5bn that we’re putting into farming. And I’m very happy to work with farmers on that.”

Sir Keir’s spokesman made a similar argument earlier on Monday, saying the government expects 73% of farms to not be affected by the change.

Environment, Farming and Rural Affairs Secretary Steve Reed said only about 500 out of the UK’s 209,000 farms would be affected, according to Treasury calculations.

However, that number has been questioned by several farming groups and the Conservatives.

Government figures ‘misleading’

The NFU said the real number is about two-thirds, with its president Tom Bradshaw calling the government’s figures “misleading” and accusing it of not understanding the sector.

The Country Land and Business Association (CLA) said the policy could affect 70,000 farms.

Conservative shadow farming minister Robbie Moore accused the government last week of “regurgitating” figures that represent “past claimants of agricultural property relief, not combined with business property relief” because he said the Treasury does not have that data.

Agricultural property relief (APR) currently provides farmers 100% relief from paying inheritance tax on agricultural land or pasture used for rearing livestock or fish, and can include woodland and buildings, such as farmhouses, if they are necessary for that land to function.

Farmers can also claim business property relief (BPR), providing 50% or 100% relief on assets used by a trading business, which for farmers could include land, buildings, plant or machinery used by the business, farm shops and holiday cottages.

APR and BPR can often apply to the same asset, especially farmed land, but APR should be the priority, however BPR can be claimed in addition if APR does not cover the full value (e.g. if the land has development value above its agricultural value).

Mr Moore said the Department for the Environment, Farming and Rural Affairs (DEFRA) and the Treasury have disagreed on how many farms will be impacted “by as much as 40%” due to the lack of data on farmers using BPR.

Lib Dem MP Tim Farron said last week1,400 farmers in Cumbria, where he is an MP, will be affected and will not be able to afford to pay the tax as many are on less than the minimum wage despite being asset rich.

Politics

Cabinet split over assisted dying as Education Secretary Bridget Phillipson latest to reveal she will vote against bill

Published

6 hours ago

November 18, 2024

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Cabinet split over assisted dying as Education Secretary Bridget Phillipson latest to reveal she will vote against bill

A split is emerging in the cabinet, with Education Secretary Bridget Phillipson revealing she will join several of her colleagues and vote against the bill to legalise assisted dying.

Ms Phillipson told Sky News she will vote against the proposed legislation at the end of this month, which would give terminally ill people with six months to live the option to end their lives.

She voted against assisted dying in 2015 and said: “I haven’t changed my mind.

“I continue to think about this deeply. But my position hasn’t changed since 2015.”

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MPs will be given a free vote on the bill, so they will not be told how to vote by their party.

The topic has seen a split in the cabinet – however, Prime Minister Sir Keir Starmer has yet to reveal how he will vote on 29 November.

Ms Phillipson joins some other big names who have publicly said they are voting against the bill

These include Deputy PM Angela Rayner, Health Secretary Wes Streeting, Justice Secretary Shabana Mahmood and Business Secretary Jonathan Reynolds.

Border security minister Angela Eagle is also voting against the bill.

Senior cabinet members voting in favour of assisted dying include Energy Secretary Ed Miliband, Science Secretary Peter Kyle, Work and Pensions Secretary Liz Kendall, Culture Secretary Lisa Nandy, Northern Ireland Secretary Hilary Benn, Transport Secretary Louise Haigh and Welsh Secretary Jo Stevens.

The split over the issue is said to be causing friction within government, with Sir Keir rebuking the health secretary for repeatedly saying he is against the bill and for ordering officials to review the costs of implementing any changes in the law.

Sky News’ deputy political editor Sam Coates has been told Morgan McSweeney, the PM’s chief of staff, is concerned about the politics of the bill passing.

He is understood to be worried the issue will dominate the agenda next year and, while he is not taking a view on the bill, he can see it taking over the national conversation and distracting from core government priorities like the economy and borders.

Details of the bill were published last week and include people wanting to end their life having to self-administer the medicine.

It would only be allowed for terminally ill people who have been given six months to live.

Two independent doctors would have to confirm a patient is eligible for assisted dying and a High Court judge would have to give their approval before it could go ahead.