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This is one big padlock that might not keep you safe . . .

There is current a padlock on your state pension - but for how long?
There is current a padlock on your state pension - but for how long? There is current a padlock on your state pension - but for how long?

DID you know that there is a big bronze padlock on your state pension?

Since 2010, the value of the state pension has been protected by the ‘Pensions Triple Lock’, which increases its value in line with inflation, average earnings, or 2.5 per cent, whichever is the higher.

The thinking behind the triple lock is to keep the state pension growing at a rate that allows you to purchase the same amount of goods as last year. It protects your spending power, and is a popular measure liked by everyone.

Well, everyone except the Chancellor of the Exchequer Philip Hammond and his next-door neighbour, Theresa May.

Theresa is on the campaign trail, paving the way for the June 8 election. Answering questions at an event in her Maidenhead constituency, she made a point of not committing to the triple lock, if the Conservatives hold on to power.

Then Philip, on a visit to Washington, went further: “We said back in the Autumn Statement we would review these issues before the next election. That is the right thing for us to do, and we’ll set out our position in the manifesto.”

Sounds like the triple lock is in the same boat as a turkey three weeks before Christmas. It should be extremely worried, and it might not see the New Year.

So why have Tess and Phil developed this sudden aversion to padlocks?

Well, padlocks are guarantees, and guarantees cost money. This one is a very expensive guarantee – it would cost £45 billion over the next 15 years.

So what could happen next? One suggestion is that they may replace the triple lock with a link to average earnings. The problem is that if inflation is higher than the rise in average earnings, then the value of the pension will be eroded, meaning that you will be able to buy less with it.

If that goes on, it will be a problem of Titanic proportions. The state pension will be holed beneath the waterline, and we will look on, as its value slowly sinks.

The triple lock is not the only headache politicians have, in relation to the cost of the state pension.

Everyone knows that, these days, we are living longer and drawing our state pensions for longer, which means that we remain a ‘cost centre’ for the government for longer.

The fact is, Tess and Phil are finding it extremely distressing that we’re stubbornly refusing to die!

While in Northern Ireland we have shorter lives than in England, a newborn boy here is still expected to live to a very inconvenient 78. Newborn girls are even more unreasonable, living to 82.

The number of years we stand to live in bad health is also increasing, so we are causing Tess and Phil to lose sleep over our cost to the NHS as well.

If the Tories win the election, and the triple lock is removed, the state pension may buy a lot less in 20 or 30 years than it does today.

Whereas our parents or grandparents could live on the state pension, it may now dwindle from a reasonable replacement wage to mere pocket money.

This is why it really does make sense to take the initiative yourself.

Perhaps it might be advisable to set up a personal pension, alongside your other pensions, as an additional income stream that will raise the quality of your lifestyle when you finish working.

Act now, before Theresa May unlocks that bronze padlock, and throws away the key!

:: Michael Kennedy is an independent financial adviser and pensions specialist, and can be contacted on 028 71886005 . Further information on Facebook at “Kennedy Independent Financial Advice Ltd”