British expat state pensioners who have had do not receive inflation-linked pay rises may have a lifeline that brings them in extra cash.
Two MPs want to see the law changed so all expats pick up the annual pension increase.
Expat pensioners living in countries outside Europe or those that do not have an agreement with the UK about state pension payments have their state pension frozen at the amount of the first payment.
However, the MPs, Tory backbenchers Sir Roger Gale and Sir Peter Bottomley plan to table an amendment to the Pensions Bill, which is currently passing through Parliament.
Expat with frozen state pensions have campaigned for equality with other state pensioners for many years, but they finally lost their legal challenge when the European Courts of Justice rejected their arguments and backed the government.
£90 a week payment difference
Since then, the campaign has resorted to lobbying politicians for support.
They complain that some expat pensioners in their 90s are only paid £20 a week – the level of the state pension 30 years ago – while pensioners the same age living in Spain pick up £110 per week, the same as those living in Britain.
The number of pensioners involved runs into hundreds of thousands.
The payment depends on where the state pensioner lives in retirement. The British state pension is paid at the same rate as in the UK in European Union countries. Other nations with agreements with Britain also pay the full rate – these include the USA and Switzerland.
Other popular expat destinations like Canada, Pakistan and New Zealand do not have agreements, so state pensioners receive the frozen rate.
Fair financial deal
Sir Roger said: “After speaking with Peter Bottomley, we agreed Peter will, with my support, table an amendment to the Pensions Bill. We do not know what the result will be, but it is worth a shot.
“We feel our overseas pensioners should get a fair financial deal, with their pensions brought into line with the amounts paid in countries where we have a reciprocal agreement.”
The Department of Work and Pensions confirmed the government will only increase the state pension in line with inflation if the pensioner lives in a country where index-linking is a legal requirement or a reciprocal agreement is in force.
“This has always been the case and people who are considering emigrating abroad should always consider the impact the move could have on their future state pension entitlement,” said the spokesman.
Both Clegg and Webb supported full indexation when they were in opposition. Both oppose it now they are in government. They recite the same reasons as the previous government did, but they must have known about these reasons when they supported our cause. The only difference is that they are now under the control of “Sir Humphrey”.
This same situation has been looked at from
many different angles, but the moral issue still remains that who ever paid into the pension scheme,no matter what country they decided to emigrate too, should be entitled to the monthly increments, and even more so if they are bone fide British citizens. I think it’s about time they really gave this unfair situation a really good looking into.