Workers being 'hammered' while pensioners benefit, says analysis

A Centre for Policy Studies analysis reveals that Chancellor Rachel Reeves' November 2025 budget decision to freeze income tax and national insurance thresholds until 2031 will leave workers worse off than they would be otherwise. Using OBR forecasts, the think tank calculated that a worker earning £50,000 today will be £505 worse off in real terms by 2031 despite expected £6,000+ salary increases, due to being pulled into higher tax brackets through fiscal drag. Meanwhile, pensioners benefit from the triple lock guaranteeing state pension increases of at least 2.5% annually, potentially gaining £306-£537 in real terms by 2030-31, while unemployed individuals on universal credit could be £290 better off. The Treasury defends the £23bn revenue measure as 'fair and necessary' for funding NHS improvements and debt reduction. Reeves had previously criticized such freezes under Conservative governments but implemented them herself to avoid breaching her manifesto pledge against raising income tax, VAT, or national insurance.