Pensions minster Paul Maynard has said the DWP has “no plans” to uprate frozen state pension payments for more than half a million UK expats.
Speaking as part of a debate on UK residents living overseas last week (February 5), MP Rob Roberts told Maynard it was a “matter of simple fairness” for all British citizens living in the Commonwealth to be entitled to an uprating of their state pension.
UK expats affected by this issue reside mostly in Australia and Canada.
He said: “Following our withdrawal from the EU, we are rightly able to move closer with our partners in the Commonwealth and one of the ways we can do that would be to confirm that all British citizens that live in the Commonwealth should be entitled to the appropriate uprating of their state pension as if they were still in the UK, it would seem a matter of simple fairness.
“Will the minister meet with me to discuss the practicalities of making that happen and restore some much needed common sense to a needlessly complicated situation?”
But, Maynard said the UK government does not plan to look into this.
He added: “The UK government continues to uprate state pensions where there is a legal requirement to do so and has no plans to change its longstanding policy or enter into any new reciprocal social security agreements.
“According to the latest estimate, based on data from March 2022, uprating the state pension where we do not currently do so would cost about £0.9bn a year if all UK state pensions in payment were increased to current UK levels.”
A parliamentary petition created by Robert Lloyd Crutchlow is attempting to get the state pensions of around 500,000 UK citizens living overseas to be increased to current rates and to receive annual future increases.
The petition said: “We believe the need for reciprocal social security agreements has long passed as other countries already pay their pensioners in the UK annual increases. We believe the freezing of UK citizens' pensioners is discriminatory, unjust and immoral.”
Yazmin Boden, partner at GSB Capital- which offers expat advice- said it would be “prudent” for this policy to be reviewed in full “in the aspect of fairness”.
“Retirees within the Commonwealth, in receipt of the UK state pension, met the contribution requirements to accrue a full national insurance record in good faith.
“Those whose pensions were frozen over 20 years ago are at a significant disadvantage with limited capacity to improve their retirement income and subsequent lifestyle.
"However, ultimately, it comes down to affordability. In recent years, we witnessed the failure of the triple lock to protect against the rising cost of living for UK retirees. Thus, the issue of inflation proofing and the UK state pension is, unfortunately, much greater than the subject at hand,” she added.
