This is Armchair Economics with Hamish McRae, a subscriber-only newsletter from The i Paper. If you’d like to get this direct to your inbox, every single week, you can sign up here.

This is Armchair Economics with Hamish McRae, a subscriber-only newsletter from The i Paper. If you’d like to get this direct to your inbox, every single week, you can sign up here.

It has not been a good week for Rachel Reeves, with the UK’s economic growth being downgraded in the latest IMF forecasts, the war in Iran predicted to hit us harder than other major economies, and her inability to provide additional funding to rebuild our forces. There is, however, a way forward, if she were to take it.

It is not quite a get-out-of-jail-free card, but it would clear another path where she could rebuild the government’s finances. If she could do so, it would make the country’s fiscal position vastly much more manageable.

It is to loosen the triple lock on the state pension. The argument against the triple lock – the mechanism by which pensions increase by whichever is highest of average earnings, inflation, or 2.5 per cent – comes in two parts. That it is unaffordable; and that it is unfair.

The case for it being unaffordable is the result of the growing numbers of people of retirement age relative to those still at work, the volatility of earnings, and the surge in inflation. The Office for Budget Responsibility (OBR) calculates that the annual cost of the policy is three times what it was expected to be when it was introduced in 2011, and that this additional charge is estimated to reach £15.5bn by 2030. So despite its popularity among the huge numbers elderly voters, the pressure is on for the Government to abandon it.

But there is a........

© iNews