The Isle of Man plans to change its pension system, affecting many residents’ benefits.
Isle of Man: The Isle of Man is changing its pension system. They plan to scrap their version of the triple lock. This change affects residents who reached state pension age after April 5, 2019. They will get a less generous version of the UK’s pension system.
Dr. Alex Allinson, the treasury minister, explained the decision. He said the government believes workers and businesses shouldn’t bear the cost of higher pension contributions. This change aims to make the pension system more affordable.
In the UK, a similar change is unlikely. However, Kemi Badenoch, the Conservative leader, suggested means testing the triple lock. This idea has drawn criticism from Labour leaders, who oppose the change.
During an LBC interview, Badenoch discussed means testing. She stated that the current system isn’t working well. She believes the focus should be on why the economy isn’t performing as it should.
MPs have asked Badenoch for more details about her comments. So far, she hasn’t responded. This is a shift from Rishi Sunak’s promise to enhance the triple lock system.
What is means testing?
Means testing checks a person’s finances to see if they qualify for payments. It aims to help those with less wealth receive more assistance. Recently, Labour faced backlash for means testing winter fuel payments, limiting benefits to low-income pensioners.
What is the state pension triple lock?
The triple lock, introduced in 2011, ensures the state pension rises each year. It increases by the highest of three measures: inflation, average wage growth, or 2.5%. In 2024, the pension will rise by 8.5% due to inflation.
This April, it will increase by 4.1%, matching wage growth. The triple lock aims to protect pensions from rising prices and maintain spending power.
What is the state pension age in the UK?
The current state pension age in the UK is 66. This is when you can start receiving your state pension. Before this age, you can only access personal pensions, usually not before 55.
The state pension age will gradually rise to 67 starting May 6, 2026. For those born on April 6, 1960, it will be 66 and 1 month, and it will continue to increase for others.
