Mr Greer said: “In the autumn, the government are likely to make a change to the triple lock and could temporarily amend the triple lock by uprating the state pension based on the higher of 2.5 per cent, inflation or five-year rolling average wage growth.
"This will smooth any abnormal wage effects whilst protecting real incomes and saving the government a considerable amount each year.
“The government should use this opportunity to carefully consider the merits of moving to a long-term solution, such as a smoothed earnings link, so that pensioners share in the proceeds of economic growth, whilst protecting their income against inflation and ensuring intergenerational fairness.”
The government looks as though it is "putting off the bad news until later in the year", according to Tom Selby, senior analyst at AJ Bell.
He said: "The chancellor was clear stabilising the public finances and paying off the estimated £300bn bill racked up during the pandemic will be a key priority in his Autumn Budget.
"The choice facing the government is simple, if unpalatable: retain the triple-lock and gouge an even bigger hole into the Treasury’s balance sheet, or abandon the policy – perhaps temporarily – and hope those affected will forgive them.”
Andrew Tully, technical director at Canada Life, agreed that the Autumn Budget was where there will be more focus around spending plans for future years.
He said: “Far from being kicked into the long grass, that is likely to be where we see at least temporary changes to the state pension triple lock. The government may also look again at pension tax relief although the difficulty in implementing change in a simple, straightforward manner continues to be a significant issue.”
Meanwhile, Alistair McQueen, head of savings and retirement at Aviva, applauded Mr Sunak for leaving pensions alone in his statement so as to not panic savers at such a volatile time.
Mr McQueen said: “With so much uncertainty, today was not the day to panic on pensions. We’ve been encouraging pension savers not to panic and to focus on the longer term. It’s good to see the chancellor has also followed this course of action.
“For our industry, all eyes now turn to the autumn budget. The chancellor signalled this is when he hopes to begin balancing the books. As to how he should move, it’s premature to say. But not even the chancellor knows where the economy, or the coronavirus, will be in four months.”
amy.austin@ft.com
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