Burnham told to consider means-testing state pension to fill defence blackhole

Andy Burnham has been urged to consider means-testing the state pension to help fill a £4.7 billion defence budget gap. The suggestion comes from tax expert Dan Neidle, a member of the Labour Party, who published 37 options on a tax policy website to cover the unfunded portion of Sir Keir Starmer’s Defence Improvement Plan. Neidle argued that excluding the wealthiest from receiving the pension could save £1 billion per year, while acknowledging that the policy would break the link to the state pension’s universal design created in 1908 under National Insurance. Burnham has ruled out breaking Labour’s 2024 manifesto promise not to raise income tax, VAT, or National Insurance contributions. The article notes he also reiterated the “triple lock” for annual pension increases. Neidle’s alternative top option is fiscal drag via freezing income tax thresholds, with Reeves extending the freeze to April 2031. The piece frames the broader challenge of potentially needing an additional £13 billion.