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Conservatives Will Keep Pension ‘Triple Lock’ in Platform, Hunt Says

(Bloomberg) -- Britain’s ruling Conservative party will promise to keep the generous “triple lock” on state pensions in the upcoming election despite the spiraling cost of the commitment, Chancellor of the Exchequer Jeremy Hunt said.

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Speaking to UK broadcasters on Sunday, Hunt said the triple lock — a guarantee that the state pension for the country’s 12 million retirees rises by the highest of inflation, average earnings, or 2.5% — would be a manifesto pledge.

He also signaled that there would be another fiscal event later this year before what is likely to be an October election and refused to commit to providing compensation for women hit by past changes to state pension eligibility.

Last week Hunt said the triple lock was “kept under review,” prompting speculation that it could be replaced with a less generous commitment. His clarification on Sunday is likely to have been an attempt to reassure older generations, who make up much of the Conservative party vote.

The Tories are lagging well behind the Labour opposition in the polls despite £20 billion ($25.2 billion) of tax cuts for workers in the last two fiscal statements and need to consolidate their base against an attack from the right wing Reform UK party.

Read more: UK’s Hunt Says UK State Pension and Benefits Are ‘Under Review’

“I can confirm it will be,” Hunt said when asked in a BBC interview Sunday whether the guarantee would remain in the party’s manifesto. “We made that commitment to pensioners and we think it’s a very important one.”

Labour said it would match the government. “The Labour party is committed to retaining the state pension triple lock,” a spokesman said.

The Organisation for Economic Cooperation and Development and the Institute for Fiscal Studies think tank have both called for the triple lock to be scrapped and replaced with a less expensive guarantee. The IFS has calculated that the state pension is costing £11 billion a year more than had it risen in line with either inflation or earnings since 2010.

Speaking with GB News on Sunday, Hunt also revealed that the election would probably be held in October, preceded by an autumn statement.

“That’s always been my working assumption, the Prime Minister’s working assumption, so there would potentially be time for another one,” he said in response to a question about the poll timing and prospect of one more fiscal event.

Both Conservatives and Labour declined to make any commitment on compensation for women born in the 1950s who were not made aware of an increase in the entitlement age for the state pension, despite a report last week calling for the government to pay billions of pounds to those who were not prepared for the change.

In 1995, legislation was passed to gradually equalize the rules for men and women, raising the pension age to 65 from 60 by 2020. In 2011, the process was accelerated and the target date brought forward to 2018. The case was taken up by the Women Against State Pension Inequality (WASPI) campaign.

Both Hunt and Labour Party chair Anneliese Dodds refused to be drawn on the proposals by the Parliamentary and Health Service Ombudsman. The PHSO said compensation could cost between £3.5 billion and £10.5 billion after the Department for Work and Pensions failed to adequately communicate changes to the state pension age.

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