Frozen Pensions Roundtable with the NPC and ICBP: 2 February 2016
February 4, 2016 Frozen Pensions 10 Comments
On 2 February 2016, the APPG held a joint roundtable meeting with the International Consortium of British Pensioners (ICBP) and the National Pensioners Convention (NPC), to launch a new pamphlet setting out the case for reform to the government’s longstanding frozen pensions policy.
The well attended meeting brought together representatives from the NPC, ICBP and APPG, with High Commissioners of affected countries and interested representatives of the media. We were also delighted to welcome the new Shadow Pensions Minster, Angela Rayner MP, for her first public engagement on this issue.
The Case for Reform
Director of the ICBP, Sheila Telford, opened the meeting setting out the case for reform to frozen pensions, introducing the new pamphlet and referring to individual cases of pensioners who had either found themselves in poverty or forced to return to the UK, away from their family overseas, for financial reasons.
Telford expressed gratitude to the political representatives of all parties in attendance and stressed that frozen pensions “is very much a cross party issue with robust support from a range of parties”.
Telford outlined some details of the ICBP’s recent meetings with government, recognising its wider focus “to get pensions right”, but that “frozen pensions are [still] the elephant in the room”. In this context she promised that the ICBP would “keep trumpeting forever”.
Dot Gibson, the General Secretary of the NPC, outlined the UK domestic interest in changing the frozen pensions policy. Her argument was that there are increasing numbers of British people in black, Asian and Minority Ethnic communities with cultural ties to frozen countries, and that the current policy was restricting their choice.
Gibson also pointed to the inconsistency of the current approach, with pensioners living in some countries did receive uprating, while those in neighbouring states did not. Gibson noted that “only the British State could create such an anomaly”.
Gibson’s argument was strengthened by the large number of NPC BAME Committee members in attendance, many of whom spoke out to outline how they themselves and others in their communities would be affected by frozen pensions, should they wish to move overseas and they joined the call for change.
Progress with the Government
APPG Chairman, Sir Roger Gale MP noted that frozen pensions is an issue on which every major party which has had a turn in government is to blame. He said: “You don’t need to be a rocket scientist to know it’s unfair. [But] it comes down to hard cash”.
Outlining recent progress with the government, Gale said that he was hopeful of progress. He noted that “Oliver Letwin is sympathetic [and] wants to help”. He reported that he had met with both Letwin and Baroness Altman, the Minister for Pensions, since the original meetings with Letwin back in November and said that Letwin had reconfirmed the commitment of the government to examine the financial case for partial uprating and that “the Cabinet Office is going through the numbers to see if they stack up”.
Gale however cautioned campaigners that progress on frozen pensions might be slower than they would like and noted that it may be very difficult to establish likely behaviour change as a result of unfreezing, something critical to the cost neutrality arguments behind the partial uprating proposals submitted. He said that in truth: “we don’t know how many people drawing a pension in the UK and using the health and social system would return to their country of origin.”
Gale also made clear that the real challenge was persuading the Treasury to release money for DWP to change the current frozen pensions policy. He conveyed that “Ros Altmann [had] said this is not something the DWP can deal with… the DWP has not got the money… If we want new money, that money will have to come from the Treasury”. Referring to the ongoing discussions he suggested that “It may be possible to persuade the Cabinet Office and they may in turn be able to persuade the Treasury”.
Support from the new Shadow Minister for Pensions
For Labour, Angela Rayner MP recognised that “The [frozen pensions] situation is unfair, illogical and doesn’t make sense”. She welcomed cross party support on the issue and accepted “we have to find a solution.”
Rayner said: “I am hoping that the government will act… because to me there is no reason why not, especially when you look at issues around the cost neutrality of it and certainly when you look at the arguments of people being in poverty when they don’t need to be.”
Committing herself to action Rayner said: “Over 550,000 people are affected by it, sometimes losing over half of the money that they have worked hard for. They fought for our country, they’ve worked hard, paid National Insurance, paid tax for all of those years, and for me it’s completely unjust to continue in the way that way. Something has to be done and I will continue to work in my new role as Shadow Minister for Pensions to find a solution”.
SNP Pensions spokesperson and APPG Vice Cahir, Ian Blackford MP told the group that he had secured a vote on an Statutory Instrument on frozen pensions the following day. The State Pension and Occupational Pension Schemes (Miscellaneous Amendments) Regulations would introduce the mechanism for freezing the pensions of those living overseas coming on to the new Single Tier Pension system. This year the regulations only affect those living overseas deferring starting receipt of their pension, but Blackford argued that the vote was an important opportunity for MPs to make their voices heard on the wider issue.
High Commissioners call for change
The meeting was attended by representatives of the High Commissions of Canada, Australia, Ghana, and St Vincent and the Grenadines, all countries home to frozen British Pensioners. Each felt strongly that it was wrong to ask their countries to subside the cost of UK pensioners, who had paid into the pension system of the UK not theirs, and that it was time for the UK government to look again at this issue.
Alan Kessel, the Deputy High Commissioner of Canada, said that “People have contributed to this country and this should be recognised. We are happy to discuss the issue of frozen pensions with the British government. It is simply a matter of principle.”
Cenio E. Lewis, the High Commissioner of St Vincent and the Grenadines, said: “It’s almost like a lottery. It’s deterred some from going home…We’re having to subsidise the British government by making contributions to their pensioners based overseas and welcome the option of partial uprating. This is an issue which needs sorting out”.
The frozen pensions pamphlet launched at the event can be downloaded here.
The event has since been written up by the media in attendance, with significant pieces in the Daily Mail, Citywire and the International Investment. The Independent also referred to it in an article prior to the meeting taking place.
February 9, 2016 - 1:47 am
Helpful but not hopeful.
Once again we here “we have not got the money”.
Look down the list of UK spending. We see that although the House of Lords were not
happy about the HS2 programme it’s still here with the estimate now doubled. Of course we jump on Overseas Aids £11.4 billion.
It seems that my prediction of June 2014 has happened. I wrote on the killing off of the NIS. (Gummers Bill that run out of time. Osborne’s attack on tax free allowance etc). Well according to one board member of a campaigning group, at the time, that was all a figment of my imagination.
About a year later Simon Read of the Independent wrote an article also on the death of the NIS.
Had he had the same figment of imagination?
According to the above report above, the DWP has not got the money and uprating cost must come from the treasury. Therefore, we must assume that the NIS Fund has been passed into the general fund. Strangely the balance of the fund according to GAD by 2016 is forecast at £30 billion. (The
fund basically was to collect contributions pay out pensions, (plus some other payments). ALSO to pay for exceptional expenses). If the fund had been maintained as it was required to be then uprating frozen pensions would be covered as an exceptional payment.
A government spokesman some time ago said the fund had loaned out money for other things such as housing and hospitals. No objection to that but a big objection to not paying for the cost of uprating. Call in the loan to cover the cost, the housing/hospital can go to the treasury to cover the cost of repaying the NIS Fund loan. All far too simple of course!
Of course the Government/DWP holds the power over pensions and frozen pension policy. After all they are the law makers. They can ignore the campaigners and dismiss their evidence for uprating
and just keep finding other excuses to continue Ad infinitum this frozen policy.
30 odd years of campaigning has seen thousands of frozen pensioners die, including war heroes, without seeing, a fully entitled to, uprated pension. How many more will die before the policy is changed? Pensioners do not live Ad infinitum!
All workers in the UK pay equal rates of NI contributions for a State pension. The only condition to being entitled to that pension being the length of contributory years. (The Pension Act. Part1 section 2). “What you pay in you get out”. (Part of one of Mr Cameron’s election campaign speeches).
Only a “small print” added clause allows uprating of pensions to overseas pensioners to be withheld, without giving justifiable reasons in the Act.
There is no requirement for RAs. (as stated back in 1966) So using them as an excuse is unjustifiable. . The cant afford it excuse is nonsense. How can you accept half of overseas pensioners getting uprated the other half not, as beingfair, justifiable and giving equality?
February 9, 2016 - 11:22 am
The Parliamentary Select Committee report of as long ago as 1996-7 states, “Britain was alone among the OECD countries in discriminating between pensioners in different overseas countries, rejecting any suggestion of compromise”. From the same report it continues, “Surely no-one would have deliberately designed a policy of paying pensions to people living abroad intending to end up in the position we are at today… A simple change in British law could enable up-ratings to be paid in any or all overseas countries, provided the political will was there to do so.” There is no political will in the UK on this issue, only economic foolishness, as espoused by Keith Vaz MP [Leicester East] http://www.easterneye.eu/news/uk-news/Frozen%3A+Pensions+bias+leaves+Asians+cold/4432
February 9, 2016 - 5:37 am
Same old, same old.
The Treasury cannot find the £600 million for British pensioners but it can find £2 billion and more – and more – for overseas aid and spurious projects in questionable countries, not to mention the excessive fees paid to the Tory appointees to manage these projects. Then of course there is the extra billions found to deal with the “refugee crisis” – a good cause but no better than the British pensioner cause when many of those frozen pensioners fought for their country and returned to help rebuild a shattered Britain, paying into the NI Fund every day of their working lives.
No, the “no money” argument does not hold water – the government could find the money if it wanted to. This is all about political will and the willingness of the government to “act fairly and to do the right thing”.
Haven’t we heard these words many times from David Cameron??
February 13, 2016 - 12:16 pm
Yes frozen- oap I totally agree with you 500 per cent and frankly totally dismayed how sucessive Govts have got away with it for so long. We want our pensions uplifted and what exactly is the problem A DISGRACE INDEED.
February 9, 2016 - 3:35 pm
Has anyone considered what the position would have been had National Insurance and the State Pension Scheme been run by a private company? There would be a public outcry and shouts of ‘fraud’ committed by the company’s directors for collecting ‘premiums’ in full from a group of pensioners only to subsequently cheat them out of the full pensions they had earned. Heads would surely have rolled.
I am a frozen pensioner living in Indonesia, but am fortunate in that I can still work. Most other frozen pensioners out here see their purchasing power diminishing every year. And there is no assistance from the local government. On the contrary, Westerners here are automatically considered to be ‘wealthy’ and expected to always give rather than take. Some who are in desperate straights would love to return to Blighty and claim the social benefits afforded to pensioners living there together with young people who do not want to work, refugees and asylum seekers. But they are tied by circumstances; perhaps they have a local wife and children or are too infirm to make the journey. Their future is bleak, but does anyone in the UK care?
Our peers in Australia, Canada and a few other countries are more fortunate. They live in countries that supplement the income of British frozen pensioners even though the UK was the country that took their contributions. What an embarrassment for our country, which once led the world.
But a word of thanks to those politicians in the UK who have taken up the cause even though they do not stand to benefit through additional votes or anything else. They have recognised a gross injustice that needs to be rectified and can be rectified by reallocating a tiny percentage of funds that are directed to less deserving causes. And shame on those leaders who have perpetuated the injustice and the MP’s who have toed their leaders’ line and have declined to stand up and be counted. Maybe they don’t care if the war hero who helped secure the country for them receives a frozen pension of just six pounds a week. Especially if he can no longer vote for them.
February 27, 2016 - 5:03 am
And Cameron, visiting the Carribean last year, promised large donations, forgetting that, apart from Jamaica, the other countries to whom he was promising such largesse lose money because all their expat pensioners have annually decreasing incomes and the states where they live eventually have to support them.
As Alan Bennett said, there’s no hypocrite like a Brit…
February 12, 2016 - 7:07 am
It is been estimated and accepted by Government that savings of 3,800 pounds/year by each pensioner living in a Frozen country. That’s a a total saving of 2,128,000,000. pounds per year to the Treasury. This being the undisputed fact, why is it hard for the Government to see that encouraging pensioners to move abroad to be with their families is a cost saving? The economics make sense when the estimated cost of partial uprating is 30,000,000 pounds per year. I am not an accountant and I don’t have a number crunching machine,but it seems to me that if the Treasury can’t or don’t want to see this there must be something I’m missing. Could it be that This is NOT a case of money,and more a case of politicians unwilling to accept that their policies regarding this issue have been wrong from the start? If this is the case the elephant in the room is going to take some shifting and no amount of money is going to change that. Where there is a will there is away.
February 21, 2016 - 7:00 am
They cry: The meeting was attended by representatives of the High Commissions of Canada, Australia, Ghana, and St Vincent and the Grenadines, all countries home to frozen British Pensioners.
Each felt strongly that it was wrong to ask their countries to subside the cost of UK pensioners, who had paid into the pension system of the UK not theirs, and that it was time for the UK government to look again at this issue.
And still they do nothing. Easy answer.Start asking for the money….or else.
February 21, 2016 - 8:53 am
Partial Uprating belongs in the last chance saloon. After this there are no more solutions and the Governments cry of” The country cannot afford it” will sound hollow.
February 27, 2016 - 3:11 am
Canada should immediately freeze any money it contributes to the Commonwealth/CHOGM, some 20 to 25 million dollars.
Talk is not enough, and Altmann, the turncoat, has just said in the House of Lords that the government has had a “consistent” position – yes, consistently unjust and unfair.
Canada, which up-rates pensions wherever one lives, needs to cease any contributions to the UK. And we all need to stop buying British (remember expo 67 and cool brittania?) Now there’s utter disillusionment and worse…