Eilidh Whiteford seeks up-rating reassurance for frozen pensioners

February 22, 2017 Frozen Pensions 3 Comments

On 21 February 2017 Dr Eilidh Whiteford, the SNP’s Westminster Spokesperson on Social Justice and Welfare, and a member of the APPG on Frozen British Pensions, took the opportunity of a debate on the Social Security Benefits
Up-rating Order 2017 to raise her concerns about the exclusion of overseas pensioners.

The Uprating Order is the Statutory Instrument used to increase all State Pensions by the triple lock. This year 2.5%.

Many overseas pensioners will be excluded from receiving their increase by a further SI, the Social Security Benefits Up-Rating Regulations 2017, which is expected to be brought forward in March.

In the debate Eilidh Whiteford said:

Pensions uprating is a wistful dream for some pensioners. Those who have frozen pensions are left out of the uprating. That is still a very live issue, and one that is likely to be more acute in the months ahead. There are those who are entitled to a UK state pension by virtue of having worked for it and of having paid their contributions but who have, for whatever reason, spent their retirement domiciled abroad. They face very different circumstances depending on whether their country of residence has a reciprocal agreement with the UK for the uprating of state pensions. Those in countries that do not have a reciprocal arrangement with the UK see their pensions frozenat their initial retirement level so, in real terms, the value of their pension falls every single year.

There are thought to be more than half a million people with frozen pensions, mostly in Commonwealth countries such as Australia, Canada, New Zealand and South Africa, but also in countries with strong family and historical links to the UK such as India, Pakistan, parts of the Caribbean and Africa. The issue will only become more acute in the months ahead as the UK leaves the European Union and European economic area. UK pensioners who retire to sunnier parts of the continent—there are thought to be 400,000—currently get their pensions uprated throughout the EEA as normal, but reciprocal arrangements will need to be put in place when we leave the EU if those pensioners are not to find themselves in the same difficult situation as those living in Canada and Australia. I hope that the Minister will be able to share the Government’s thinking on that issue, and tell us what steps they are taking to protect UK pensioners who live in other parts of Europe.

We need to deal with the fact that many of those approaching pension age, who have lived through an era of globalisation, will have worked in several EU countries and may have accrued pension rights in several parts of Europe, with wee bits of pension in several systems. That is true for many people who have worked in global industries or for multinational corporations. It is a bit of a minefield, and it would be immensely helpful if the Minister offered reassurance to UK pensioners living in EU countries that those issues are on the Government’s radar and will be addressed. I hope that the Minister will take the opportunity to address all the issues I raised as she closes the debate.