Reeves must scrap ‘bonkers’ pledge on pension triple lock, warns chancellor’s former economic adviser
Reeves must scrap ‘bonkers’ pledge on pension triple lock, former adviser says
- Chancellor Rachel Reeves is facing pressure to abandon Labour's commitment to the state pension triple lock.
- Jim O'Neill, a former advisor to Reeves, criticizes the commitment as "bonkers" and economically unsustainable, especially given the worsening economic outlook and rising government borrowing.
- Reeves acknowledges the difficult economic situation, stating that tax and spend policies are not feasible, and is expected to announce budget squeezes, including a £5bn saving from benefits.
- Despite fiscal constraints, the government remains committed to not raising major taxes, putting further pressure on Reeves to find alternative solutions.
- O'Neill suggests means-testing the triple lock or adjusting tax thresholds to increase revenue, while other economists propose creative strategies like shifting defense spending off the books, similar to Germany's approach.