Thousands of expats are struggling with their finances as living costs in the eurozone are shooting up at more than four times the rate of inflation in the UK.
Life is grim in some countries as house values have collapsed by up to 40% while soaring exchange rates and cost of living costs eat in to fixed incomes.
The latest Post Office Expat Payments Index found that the cost of living abroad has risen by an average 11% worldwide since 2011 – rising closer to 15% for those in the eurozone.
Expats and Brits with overseas holiday homes face living costs of almost four times the 3% UK inflation rate (April 2012).
Only 3.5% of over 900 people asked by the Post Office had seen no increase in costs over the past year, but almost half (48.4%) said they had paid out more than 10% extra on household expenditure, motoring and meals out. A fifth (18%) said they felt that these prices had risen by over 20%.
The surge in prices was even more marked in the most popular European countries for expats, says the Post Office report.
Spain, Cyprus and Portugal were particularly hard hit with food and fuel prices named as the key issues:
- Spain: A fifth of expats said the cost of eating out had risen over 15%, while 71% reported an increase of over 10% year-on-year for fuel.
- Cyprus: All Cyprus expats asked said that prices had increased, with 30% saying prices had risen by over 20%, and a quarter reporting a rise in the cost of food of more than 20%.
- Portugal: A fifth reported year-on-year rises in living costs of over 20%, while 85% said food and household bills were up by over 10%.
While living costs were rising, three quarters of expats worldwide (72%) reported that the value of their property had either remained static or fallen in the past 12 months – one-in-ten by over 20%.
With confidence at a low ebb, more than two-thirds (67.5%) said that the price rises had already impacted on their lifestyle and would mean making significant cutbacks this year.
I sympathise with any UK expat who has been hit by cost of living increases that they can’t afford – and the huge fall of property values in the Eurozone.
Not many people can afford losses like that.
But just think that if you were on a state pension that doesn’t increase every year how much harder it would be for you.
Well 4% of British state pensioners have to do just that. They get NO increases in their state pension at all. Nothing – until the day they die!!
When you add inflation – you get a pension that falls in value every year!!! Wou;d you like that? No – I’ll bet you wouldn’t.
The UK Parliament has handed this “frozen” deal to the over half a million of UK expat pensioners worldwide for over 60 years, just because of where they live.
Thety do not get the £107 that the other 96% of UK pensioners get – they get bugger all!!
Another half a million UK expat pensioners (and part of that 96%) DO get the raises every year because they live in countries that are not on the “frozen” list.
Is it discrimination? According to the UK civil service – no!!
Is it unjust – again by the DWP – no!! Is it unfair (DWP) no!!
Is it illegal (according to Parliament who wrote the law) no!!
It is because it’s the whim of MPs – that’s all. The same MPs can change it “at a stroke”.
It’s our money that they are keeping from us – we paid it into the National Insurance Fund under the same conditions as anyone else – and like anyone else we expect our index linked pension in return!!
Not to pay it is fraudulent and thievery. The policy is cruel and discriminatory. If British MPs had any morals left – they’d pay us what we’re long overdue – the pension we paid for!!
I can symapthise with Nine Penneth and agree that this freezing is apoor reflection on the British government who are only too quick to point the finger at some of the stupidity and unnecessary regulations coming out of Europe but then continue doing this discrimination to their own citizens. It is not only unnecessary because it is affordable with the NI fund being in such a healthy surplus but it is illogical because it id deterring pensioners from emigrating which would save the government about £7000 per year as I understand it. They paid back interest last year of about £1.3 billion for the use of money from the fund because it is ringfenced and that is about twice the amount needed to pay all pensioners worldwide the uprated pension. Indoing so they could probably reduce the size of the DWP due to their not having to answer queries and send out letters and leaflets (most of which are out of date and incorrect anyway) but they would be able to save on staf,accomodation and running costs. After all , they are trying to save mone and this is a win win solution. We get our rightful pension . They get to reduce their running costs and the pensioners have the freedom that they deserve and have paid for to retire wherever they like.
Nine Penneth has covered the disgraceful discrimination suffered by just 4% of UK state pensioners. David Cameron and Steve Webb vowed to end this injustice if they won the election, Steve Webb even tabled an Early Day Motion to this effect, stating that as all pensioners paid into the NI scheme all should be treated the same, not to do so is unfair and discriminatory. What have they done since the election? Nothing…they never mention the frozen pensioners at all. We have pension reforms coming in soon and all the articles about this ignore the plight of the 4% who are living in increasing poverty as each year their pensions are worth less. Some are getting less than £15 a week, when by rights they should be getting more than £100 a week, I defy anyone to try to live on that. David Cameron says he cares for Britian’s seniors and yet does nothing to end this theft of pensioners hard earned money. The NI fund has a surplus of £38 billion, to give the 4% their rightful uprating and bring them inline with the other expats and UK residents will cost less than 1%. Why should expats in Canada get no increases when expats a few miles away in the USA enjoy annual increases? This is a crazy lottery…where one lives in retirement is irrelevant, ALL have paid for a state pension ALL should receive the annual uprating. The state pension is not a handout from the government it is money taken out of our pay over 40 odd years, it does not belong to the government and is not their’s to withold and decide who gets annual uprating and who does not.
Shame on you both, Cameron and Webb, you have let down those desparate pensioners who thought you were honest when you promised to right this wrong and instead once in power broke that promise.