With the electorate set to go to the polls next week, we look at where the two main parties stand on pensions and social care.

Triple lock

Labour has pledged to maintain the triple lock – a policy that ensures the state pension rises in line with the highest of wages, inflation, or 2.5% each year. This means the state pension is likely to increase in value relative to both the incomes of people in work and the cost of living.

The Conservatives too have pledged to maintain the triple lock. This is in contrast to 2017, when they proposed to water it down to a double lock.

Critics have pointed out that maintaining the triple lock into the future will come at a significant cost, given the ageing population.

Annual allowance taper

Under current rules, top earners can see their ability to save tax-efficiently into a pension cut considerably. Those exceeding their allowance can face high tax bills.

The Conservative manifesto promises to “address the ‘taper problem’ in doctors’ pensions, which causes many to turn down extra shifts for fear of high tax bills”. However, that potentially means handing NHS staff special treatment and ignores large numbers of high earning public and private sector workers. Experts say the government should simply scrap the taper altogether.

Reference to the controversial and complicated pension taxation policy is absent in the Labour party manifesto.

Workplace pensions

Thanks to automatic enrolment, record numbers of employees are now saving into workplace pension schemes. However, apart from criticisms that the initial minimum savings rate was set too low, there have been some other concerns.

Labour says it would “stop people being auto-enrolled into rip-off schemes” and seek to expand access for more low-income and self-employed workers.

Meanwhile, the Conservatives have promised to conduct a “comprehensive review” of how to fix the issue of ‘net pay’ pension schemes. More than one million low earners are missing out on a tax relief top up because of a quirk in the way their workplace pensions operate.(1)

Women Against State Pension Inequality

The government has come under increasing pressure to compensate women who lost out as a result of rapid changes to their pension age. These changes have given rise to a long-standing campaign (WASPI), with some women born in the 1950s arguing they were given insufficient time to prepare for the changes brought in by the former coalition government.

The Conservative manifesto contains no reference to compensation. However, Labour says it would “work with women to design a system of recompense for the losses and insecurity they have suffered”. The payments – estimated to total £58 billion over five years – were not originally included in the party’s costed manifesto.(2)

State pension age

Under Conservative plans, the state pension age will rise for men and women to reach 66 in October 2020 and 67 between 2026 and 2028. The state pension age looks set to rise again to age 68 between 2037 and 2039.

Labour says it would abandon Conservative plans to raise the state pension age further, leaving it at 66. It also says it will review retirement ages for physically arduous and stressful occupations, including shift workers, in both the public and private sectors.

Social care

Labour has pledged to create a £100,000 cap for care costs in old age, underscored with a lifetime cap on personal contributions.

The Conservative Party says it would build a cross-party consensus to bring forward an answer that solves the problem of social care. It states a “prerequisite of any solution will be a guarantee that no one needing care has to sell their home to pay for it”.


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1 Office of Tax Simplification, October 2019

2 Labour.org.uk, November 2019

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