The Resolution Foundation has urged the Government to abolish the triple lock on the State Pension, describing the mechanism as costly and inefficient in damning new analysis.
According to the think tank, switching to a smoothed earnings link from next year would deliver annual savings of £650million by the end of this Parliament.
The Foundation argues these funds could be redirected to double investment in the Youth Guarantee programme, which supports young people outside employment, education or training.
State pension expenditure represents the largest contributor to rising welfare costs during the current parliamentary term, the briefing states.
A leading think tank has called on Labour to 'call time on the state pension triple lock'
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Under the triple lock, state pension payment rates are guaranteed to increase annually by either the rate of inflation, average wage growth, or 2.5 per cent, whichever is highest.
The think tank's analysis identifies three fundamental flaws with the current policy that continue to undermine people's retirements and the Government's attempts to bring down spending.
These include the fact that pension spending is projected to rise by £13.8billion in real terms by 2029-30, making it the primary driver of increased welfare expenditure.
According to the Resolution Foundation, the triple lock has proven remarkably ineffective at tackling pensioner hardship
How the state pension triple lock has changed over the years | GB NEWS / FIDELITY INTERNATIONAL LATEST DEVELOPMENTS
What has the impact of the state pension triple lock been on the public's finances | OBR During the 15 years before its introduction, poverty rates among older people dropped by 15.8 percentage points. Since the policy came into effect, however, pensioner poverty has actually increased by 2.3 percentage points.
Finally, the think tank notes the Office for Budget Responsibility (OBR) forecasts pension spending will grow by £80billion over five decades, but this figure could swing by £40billion either way depending on economic circumstances.
Ruth Curtice, the chief executive of the Resolution Foundation, said: "The pensions triple lock is a terribly designed policy that has proven to be far more expensive than originally planned, far less effective at reducing poverty than many hoped, and risks causing further economic harm if it continues for much longer."
She advocated for linking pension increases to a smoothed earnings measure rather than what she termed "a random ratchet".
How much will the state pension triple lock cost the British taxpayer? | OBR Ms Curtice added: "Doing this next year would save £650 million a year by the end of the Parliament, enough to double the current support to help the one million young people not in employment, education or training back into work."
The Foundation noted that the New State Pension currently stands at 30 per cent of full-time median earnings, approaching the 31 per cent threshold recommended by the original Pensions Commission in 2003.
At a minimum, the current Pensions Commission should establish a specific pension value at which the triple lock would no longer be necessary, the briefing recommends.
"We cannot afford to keep this policy for another Parliament. The Government should call time on the triple lock as soon as possible, and put the savings from doing so to far better use," Ms Curtice shared.