UK Considers Ending Pension ‘Triple Lock’ and Charging for NHS; 24+ Councils Back Four-day week
- TBA
- Jul 28
- 5 min read
Reeves should consider ending pension triple lock and charging for NHS treatment
According to The Guardian, the International Monetary Fund (IMF) has suggested in its annual assessment report on the UK economy that Chancellor Rachel Reeves should consider ending the pension "triple lock" system and introducing charges for some NHS services, particularly targeting high-income earners, in order to ease mounting fiscal pressure.
The report notes that as the population continues to age, spending on health and pensions in the UK will keep rising. By 2050, government spending is projected to increase by around 8% of GDP, significantly higher than the 5.5% average among other advanced European economies.
At the same time, global economic uncertainty is also on the rise.
Although Reeves' new fiscal rules introduced in October last year have enhanced the credibility and effectiveness of fiscal policy, the IMF warns that if economic growth falls short of expectations or interest rates rise suddenly, the current rules may be breached. As such, the IMF believes Reeves needs to create more "fiscal space" in the next budget to avoid frequently adjusting tax or spending policies, which could undermine policy consistency.
In its recommendations, the IMF suggests:
Abolishing the pension triple lock (which increases pensions annually by the highest of wage growth, inflation, or 2.5%), and instead linking increases solely to the cost of living;
Introducing co-payments for higher-income individuals for certain NHS services, while protecting vulnerable groups, to ensure a fairer income-based contribution to public healthcare;
Expanding means testing for welfare benefits to improve the efficiency of public resource allocation.
The IMF also noted that if the UK wants to achieve its economic growth goals, it faces significant challenges due to tight fiscal conditions, the complexity of necessary reforms, and a turbulent global environment—such as potential trade wars sparked by a possible return of former U.S. President Donald Trump.
Facing a growing fiscal deficit and spending pressures, Reeves has already introduced measures like raising employer National Insurance contributions starting April 2025 to boost revenue. However, with the government's recent U-turns on welfare policy, fiscal pressures have further intensified, and many expect she may be forced to announce substantial tax hikes in the upcoming autumn budget.
In response, Reeves stated that the IMF’s report validated her policy choices aimed at reviving the UK economy. She added that she will continue to push for reforms to address the UK’s “deep-rooted economic challenges and global headwinds.”
Campaigners targeting dozens of UK councils in push for four-day week
South Cambridgeshire District Council has recently become the first local authority in the UK to officially adopt a permanent four-day week, allowing employees to work just four days a week on full pay. This move is triggering a ripple effect across the country, with more than 24 local councils now included on a list of those exploring the adoption of a four-day week—and more expected to follow.
According to the 4 Day Week Foundation, local councils in Edinburgh, Belfast, Bristol, Glasgow, Fermanagh, and Omagh are currently examining the feasibility of joining the initiative. Additionally, three other councils are reportedly preparing to take concrete steps, though their names have not yet been disclosed. A further 16 councils have engaged in discussions with the Foundation and are now listed as target participants.
Since January 2023, South Cambridgeshire District Council has been piloting the four-day workweek for over a year, with employees delivering 100% of the output in just 80% of the time.
An independent evaluation conducted by Salford University, the University of Bradford, and the University of Cambridge found that 21 out of 24 public services either maintained or improved performance. The number of job applicants more than doubled (up over 120%), staff turnover dropped by over 40%, and the council saved nearly £400,000 in temporary staffing costs alone.
In February 2023, the UK launched the world’s largest-ever four-day workweek trial, involving over 50 companies. After participating, many of these companies chose to make the model permanent. Now, the concept is spreading from the private sector to the public sector, potentially paving the way for a nationwide transformation of working norms.
According to recent data, as of January this year, over 200 private companies in the UK have permanently adopted a four-day workweek—reducing working hours without cutting pay. This shift is increasingly being seen as a win-win for employee wellbeing and business productivity.
MPs calling for a wealth tax vote ahead of Labour’s Budget
As the UK government’s borrowing levels soar, 26 cross-party Members of Parliament (MPs) have jointly signed a motion calling for a parliamentary debate on a “wealth tax” ahead of the upcoming autumn budget.
According to reports, this early day motion (EDM)—backed by 26 MPs—proposes a 2% annual wealth tax on individuals with personal assets exceeding £10 million. Supporters claim that the tax could generate up to £24 billion annually, offering a potentially significant tool to address the UK’s fiscal deficit.
The wealth tax is a direct levy on a person’s net worth—including property, investments, savings, and valuable items—regardless of their annual income. Unlike income tax, it targets what you own, not what you earn.
Experts in UK tax policy have pointed out that just 10 ultra-wealthy individuals could contribute around 15% of the total tax revenue, with 80% of the revenue coming from fewer than 5,000 people.
However, the same experts also caution that “all taxation involves trade-offs.” In their view, a wealth tax could reduce investment and savings, which might lower GDP and hinder job creation and long-term economic growth.
Opposition to a wealth tax is also substantial, with several key concerns:
Capital flight: The wealthy are highly mobile and could relocate themselves or their assets to low-tax jurisdictions;
Enforcement challenges: Wealth is often held in diverse asset types (e.g., art, antiques, private vehicles), making it difficult to accurately value and monitor;
Potential economic disruption: Critics argue it could discourage investment and business activity, with long-term negative effects on economic vitality.
Currently, the Labour Party maintains its election pledge not to raise taxes on ordinary workers, meaning no changes to income tax, VAT, or National Insurance (NI). As a result, Chancellor Rachel Reeves may need to get creative with tax policy—possibly exploring reforms to inheritance tax, capital gains tax, or land value tax instead.
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