OECD calls on UK government to ditch triple-lock pensions pledge
By Benjamin Chiou
Date: Wednesday 15 Jul 2026
(Sharecast News) - The Organisation for Economic Cooperation and Development has recommended the UK government reform its pension system, urging a review of the triple-lock pensions promise which it called "unusually generous in international comparison".
In its UK economic survey released on Wednesday, the OECD said that rising long-term spending pressures mean that pension reforms are needed to "contain fiscal risks while preserving adequacy".
The triple-lock indexation of state pensions puts "upward pressure on public expenditure and adds significant fiscal risks by exposing public finances to supply shocks", the OECD said.
The so-called triple-lock pledge, implemented in 2012, guarantees that the state pension rises each year by whichever is highest among CPI inflation, wage growth, or 2.5%.
However, under the triple lock, state pensions have risen "significantly faster" than earnings, particularly during periods of macroeconomic volatility or weak growth, the OECD said, having increased by 0.5 percentage points more than earnings and by 1.2pp faster than inflation since 2012.
"The triple-lock indexation mechanism is unusually generous in international comparison. Most OECD countries rely primarily on price indexation, leading to a decline in benefit ratios as real wages grow [...] Generous indexation also has regressive distributional implications, benefitting wealthier and higher-income individuals more as they tend to live longer," the OECD said.
The comments come ahead of Andy Burnham's expected appointment as prime minister next week, with the Labour leader frontrunner having to contend with mounting government debt, which is projected to be "unsustainable over the long term", the OECD said.
"In the absence of policy changes and considering ageing costs and climate damage, general government gross debt as a share of GDP would begin to rise from the mid-2030s onwards, reaching close to 200% by 2050." That's up from an estimated 105% of GDP by 2027.
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