Pensioners frozen out of entitlements

ALMOST HALF A MILLION HIT BY UNFAIR POLICY

Very few move because they are rich... it could be work or to be nearer family

MORE than half a million UK pensioners are struggling financially because they are frozen out of the current state pension system and receive pitiful amounts of money.

These are people who have worked hard, paid all of their taxes and National Insurance contributions, the same as everyone else, and many are military veterans who served their country. But they are being left with an absolute pittance to try and survive on.

They have built up their entitlement to a state pension just the same as the millions of other pensioners but, because they have chosen to spend their retirement outside the UK, they don’t get annual increases to their pension income.

The reason is they have moved to countries that don’t have a so-called reciprocal agreement with the UK, so they don’t get the inflationary state pension rises each year. Their pension stays at the same level as when they moved out of the UK.

Over the years, this has had a huge impact on their finances, some have been left with as little as £40 a week to live off. Almost half of those on frozen pensions receive £65 or less per week.

INJUSTICE

The policy is unfair from every angle. Virtually all pensioners had no idea they would get slapped with this policy and be left struggling financially in their later years, until after they had moved from the UK.

It is not all pensioners who are living overseas that are affected. More than 1.2 million people living outside the UK receive a state pension, and more than half get exactly the same deal as those living here with yearly increases that keep up with inflation.

These include those living in the European Economic Area, which includes Iceland, Liechtenstein and Norway, and the US.

However, those living in around 90 countries including Australia, Canada, New Zealand and India are excluded.

This is because some countries have a reciprocal social security agreement around the UK state pension, and those living there get yearly increases, while others don’t have these agreements.

What is most bizarre is that the countries with the most affected are Australia and Canada, both in the Commonwealth.

Of the 525,000 UK pensioners trying to survive on frozen pensions, more than 230,000 are based in Australia and 126,000 live in Canada – that’s a huge percentage of those impacted by this unjust policy. Both of these countries provide full state pensions to their pensioners who live in the UK.

The Australian and Canadian governments have been pushing for years to end this injustice that leaves pensioners in their respective countries without their full UK state pension.

An example of the impact of the policy: a UK pensioner on the older basic state pension currently gets £156.20 per week (full new state pension £203.85 for those who reach state pension age after April

6, 2016), while a pensioner who retired or emigrated to Canada as a pensioner in 2001 has their pension frozen at £72.50 a week.

A survey of UK pensioners living on a frozen pension found almost half still work or have had to in the past to be able to survive financially, a quarter have been forced to rely on help from family members, while almost six out of 10 were hit twice by the policy as their partner or spouse also lives on a frozen pension.

Some people may think it’s the pensioners choice to move abroad. But there are many reasons people end up living outside of the UK in their later life – very few move because they are rich and can afford to move to somewhere with more sunshine. Some end up overseas through work commitments, such as being based abroad by a UK firm in later life but still paying into our tax system, others want to be nearer their family.

Next week a delegation from the Canadian Alliance of British Pensioners will be coming to the UK to call on the government to end the injustice.

A spokesperson from the End Frozen Pensions campaign said: “Despite the Canadian government’s repeated attempts to resolve this unjust policy and end the suffering of British citizens living in Canada, the UK government has continuously refused to engage on the issue.

“The Government should be ashamed of the way it is allowing those living in Canada to be treated as second-class citizens, apparently undeserving of the pension they paid for and are entitled to.

“Once again, the Canadian Alliance of British Pensioners will be visiting London to urge the Government to find a solution to this policy and end this pension penalty for those in Canada.”

It’s shocking that pensioners are being left in poverty, including veterans who put their lives at risk to serve and protect the rest of the country.

Let’s hope the Government does the right thing and corrects this unfair situation by setting up reciprocal agreements so all pensioners get the pension they deserve.

And puts an end to an illogical policy that causes huge distress and financial harm.