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”.

Parliamentary Vote

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”.

New Pamphlet

The frozen pensions pamphlet launched at the event can be downloaded here.

Media Coverage

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.