State pension triple lock could be DITCHED in British territory due to spiralling costs

The island's state pension fund is projected to run out by 2047 due to higher life expectancy, highlighting the need for additional funding sources to maintain payments to pensioners.

Manx Treasury Minister Alex Allinson has called for a "national conversation" on preserving the system for current and future pensioners.

The Isle of Man currently has an identical triple lock to the UK, ensuring pensioners receive annual increases based on the highest of wages, inflation, or 2.5 per cent.

With 80 per cent of the National Insurance fund going to the island's 20,000 state pensioners, urgent action is needed to address the looming financial shortfall.

The Government report explains that removing the triple lock is one of only two options not yet dismissed.

Other possibilities include bringing forward the state pension age increase, which would only delay fund exhaustion by one year.

Increasing National Insurance contributions is also under consideration. However, increasing the number of years needed for a full state pension has been ruled out.

The full state pension on the Isle of Man is currently £241.50 per week, with the retirement age set at 66. This is scheduled to increase to 67 by March 2028 and 68 by 2046.

Four new methods to replace the triple lock will be discussed this month in Tynwald, the Isle of Man's Parliament.

Allinson emphasised the urgency of the situation, saying: "With an ageing population, the Isle of Man is facing increased health and welfare spending.

"I believe we need a national conversation about how we preserve the long-term future of our state pension system both for the pensioners of today and of tomorrow."

Allinson added: "Over the coming months I will be engaging with Tynwald Members to develop a plan that will ensure the long-term sustainability of the current scheme. A further report will be provided prior to next year's Budget."

LATEST DEVELOPMENTS:

• State pension 'guaranteed' to be taxed in TWO YEARS - damming Budget analysis
• State pension will rise by £475 under triple lock, Reeves confirms
• State pension warning as almost 500,000 Britons to miss out on £470 triple lock rise

No decisions have yet been made but the minister's comments underscore the Government's commitment to finding a solution that balances the needs of current pensioners with the long-term viability of the system.

While the Isle of Man grapples with its pension challenges, the UK faces similar concerns.

Labour has committed to maintaining the triple lock, but think tanks warn it could become unaffordable within a decade.

The Office for Budget Responsibility estimated that the triple lock cost a staggering £124billion in 2023/2024.

This figure is forecast to rise dramatically to £158billion by 2028 to 2029, representing a £34billion increase.

As both the Isle of Man and the UK confront rising pension expenses, policymakers face difficult decisions in balancing fiscal responsibility with the needs of an ageing population.