The Government has confirmed it will suspend the “triple lock” on pensions for one year – abandoning another manifesto pledge.

Boris Johnson also announced a National Insurance increase on Tuesday – breaking an election promise not to raise taxes.

The suspension of the triple lock comes due to the impact of Covid-19 on wages – here’s why it’s happened, and what it means for pensioners.

What is the pension triple lock?

The triple-lock guarantees that pensions grow annually in line with whichever is highest out of:

• The average wage increase
• Inflation (measured by the Consumer Prices Index)
• 2.5 per cent

It was introduced by the Conservative/Liberal Democrat coalition government in 2010 and has remained intact until now.

The Tories promised it would not be scrapped for the duration of this Parliament, but have now gone back on that pledge.

How is it changing?

The triple lock has been shelved for one year because the impact of the coronavirus crisis on wages could have led to an unaffordable rise. Instead it is essentially becoming a “double lock”.

Next year’s increase will either be 2.5 per cent or based on inflation – whichever is higher – with wage increases taken out of the equation.

Work and Pensions Secretary Therese Coffey told MPs there has been an “irregular statistical spike in earnings” over the period during which the pension rate is set, due to the economy beginning to recover from the effects of 2020’s lockdowns.

Keeping the triple lock could have seen pensioners receive a rise of as much as 8 per cent – an extra £3 billion – while many workers have been dealing with job losses, salary cuts and pay freezes.

Ms Coffey said the decision to remove the earnings benchmark “will also ensure that as we are having to make difficult decisions elsewhere across public spending, including freezing public sector pay – pensioners are not unfairly benefiting from a statistical anomaly”.

She told MPs: “At a time when we have made tough decisions to restore the public finances which have impacted working people, such as freezing income tax personal thresholds at current levels, this would not be fair.

“Setting aside the earnings element is temporary and only for one year. This means we can and will apply the triple lock as usual from next year for the remainder of this Parliament in line with our manifesto commitment.”

Opposition criticism

SNP work and pensions spokesman David Linden said: “Today’s bonanza of manifesto commitments being broken is like nothing we’ve ever seen before – indeed, I don’t think I’ve seen this many U-turns in one day since I sat my driving test back in 2007.

“Not only have the Tories hiked National Insurance, but now they’re waging war on pensioners’ incomes by watering down the triple lock.”

Labour’s Shadow Work and Pensions secretary Jonathan Reynolds said: “So this decision isn’t a one-off, but a significant repudiation of the basis upon which the Government was elected, and it would be naive to say otherwise.”