The Isle of Man government is proposing to scrap the Triple Lock system for state pensions. The current system ensures that pensions rise by the highest of inflation, wage growth, or 2.5 percent. The new measure, called the Manx Pension Guarantee, will link pension increases to either inflation or a minimum two percent rise, whichever is higher.
Treasury Minister Alex Allinson said the changes are needed to preserve the National Insurance Fund for future generations. “It’s about intergenerational fairness and accommodating the needs of today’s children and grandchildren,” Allinson stated.
Pension sustainability for future generations
“Tynwald members were clear when the matter was debated in November that workers and businesses should not be forced to bear the burden of paying increased contributions to the fund. Equally, the need for pensioners‘ income to rise by an amount that reflected the cost of living in the Island was also essential.
The Treasury has proposed that the fund should never fall below twice the annual expenditure level to ensure long-term stability. This reform aims to keep the fund sustainable and adequate to meet future benefits and pension demands.
Tynwald, the Isle of Man’s parliament, will vote on the measure during the February budget-setting process. The proposed changes seek to balance the needs of current pensioners with financial sustainability for future generations. The goal is to ensure that the island can continue to support its aging population without imposing additional financial strain on workers and businesses.
