Jeremy Corbyn says a Labour government will keep the triple-lock on the state pension.
In his speech today at the Labour party conference in Liverpool, Corbyn committed to ensure the state pension would rise in line with the highest of earnings, inflation or 2.5 per cent.
He also says a Labour government would protect the winter fuel allowance, free bus passes for over 65s and reiterated a manifesto commitment to establish a National Health and Care Service.
A paper by the Institute for Fiscal Studies notes the state pension increased by 22.2 per cent between 2010 and 2016, compared to earnings growth of 7.6 per cent and CPI inflation of 12.3 per cent over the same period.
This has pushed the value of the basic state pension up to its highest share of average earnings since April 1988.
The increased benefit to pensioners came at the cost of an increase in spending of roughly £6bn a year in 2015/16 compared with earnings indexation, and roughly £4bn relative to CPI indexation, over the period since April 2011.
AJ Bell senior analyst Tom Selby says it is tricky to put a price on the state pension triple-lock because its value depends on the performance of the wider economy.
He adds the Office for Budget Responsibility has estimated extra spending of £35bn in today’s terms if the triple-lock is retained by 2060/61, versus £15bn under earnings indexation only.