Triple lock raid to cost OAPs £15billion: Burnham savaged by union chief for hitting poorest to help pay for care reforms

Andy Burnham launched a £15billion raid on pensioners on Tuesday as he announced the scrapping of the triple lock.

In a dramatic move, the Prime Minister said the mechanism - which has protected pensioner incomes for years - will be ditched in 2030 to help fund social care reforms.

It means the state pension will rise more slowly in the next decade. Government sources said the change would save the taxpayer £15billion a year by 2040 - £1,136 for every pensioner in the country.

Under the triple lock, introduced in 2011, the state pension rises by whichever is the highest of inflation, earnings or 2.5 per cent. But in the new plan, the direct link with earnings will be lost, leaving the pension rising by inflation or 2.5 per cent.

Government sources on Tuesday acknowledged that the money saved would not cover Mr Burnham's plans and so tax rises would also be needed to pay for it, with the Health Foundation having estimated that funding social care could cost as much as £18.5billion a year.

Sources also confirmed that the new National Care Service will pay only for personal care, and not the residential costs of living in a care home. This means some people may continue to have to sell their homes to pay for care in later life.

Mr Burnham said the triple lock decision was part of a 'new settlement' to help fund the NHS-style National Care Service for social care.

But he faced an immediate backlash - as well as warnings from his own side that the policy may prove a political disaster.

Unite union boss Sharon Graham described the plan as 'electoral suicide'.

She said: 'Going to a group of people who are getting around £12,500 a year in order to pay for it [the social care plan], to take their security from them, is wrong. I think it's morally wrong.

'We need to look at other ways. I can't understand why we keep going to the well of the poorest in society as a Labour Government.'

Labour's former shadow chancellor John McDonnell warned the plan could 'risk the next election' and penalise two million pensioners living in poverty.

Reform UK's Treasury spokesman Robert Jenrick described the plan as 'just mean'. He said: 'Why is it always pensioners who are asked to be the first to make sacrifices? We didn't hear a peep on cutting the benefits bill, foreign aid or net zero subsidies.'

And Dennis Reed, of campaign group Silver Voices, said Mr Burnham had 'walked into a political minefield' by questioning the future of the triple lock and 'will be dogged by this all the way to the next election'. He added: 'He is going to spend the next three years trying to find his way out.

'Why are Labour picking on pensioners again? We have seen the backlash over the winter fuel payment - this will be the winter fuel payment on stilts.'

Mr Reed said it was 'disingenuous' to link the move to social care reforms as scrapping the triple lock would raise only a small fraction of the money needed.

But Government sources on Tuesday insisted a separate mechanism would ensure the pension does not fall below 30 per cent of average earnings over time.

While the raid on pensioners will raise large sums in later decades, it is likely to generate only a few hundred million pounds in the early years of the 2030s.

Conservative Party leader Kemi Badenoch on Tuesday said Mr Burnham's plan was 'already falling apart under scrutiny'.

She added: 'It won't generate enough savings to fund a nationalised care system for another two decades, which means more tax rises are inevitable.'

But Mr Burnham claimed the plan would be as 'significant as the creation of the NHS'.

The Prime Minister, whose own father and grandmother both spent time in care homes before their deaths, insisted that the free to use service would provide the only credible answer to the crises facing the NHS.

'There is only one real answer: a person-centred, high-quality care service that starts in the home,' he said. 'A system in the best

traditions of this party, where everyone contributes and everyone is covered, free at the point of use, and no care charges paid out of your basic state pension.'

But Rachel Vahey, head of public policy at investment company AJ Bell, warned the numbers 'don't stack up'.

She said: 'The idea that scrapping the triple lock will bankroll social care on its own is simply fantasy. The numbers simply don't stack up, at least until the cumulative annual saving from lower pension increases adds up to the cost of running a social care system.'

The Institute for Fiscal Studies 'welcomed' the abolition of the triple lock - describing it as a 'substantial step towards a more sustainable state pension system' - but warned it will not save enough to fund social care.