Immigrating to Australia can be costly for British pensioners.
British pensioners who have immigrated to Australia may see their pensions rise in a test case being heard at the European Court of Human Rights today.
The expat pensioners have been battling to get the same pension rights enjoyed by expats living in Europe and America.
European and American expats have seen annual pension rises in line with inflation, as agreed by their governments. However expats living in Australia, South Africa, Hong Kong and Canada have had their pension entitlements frozen since 2001.
The expat pensioners argue that they have paid National Insurance in the UK and that the amount of money they receive for their old age should not be decided on where they live.
One such pensioner is Annette Carson who moved to South Africa in 1989 and yet carried on making National Insurance contributions in the UK until her retirement in 2000. Her pension is currently frozen at £67.50 a week.
Ms Carson is among a group of pensioners who have previously taken their case through the British and European courts but to no avail. Today is thought to be their last gasp attempt to overturn the previous rejections, although they won’t find out the result until March.
Andrew Harrop from the recently merged Help the Aged and Age Concern groups said: “It’s hugely unfair that pensioners who have made their National Insurance contributions all their lives in the UK are being penalised for retiring abroad…We hope the case today will see an end to this inequality and ensure the Government gives every pensioner their fair share, no matter where they decide to retire.�
However the Department of Work and Pensions claim that it would cost £500million a year to deal with and backdate currently frozen expat pensions.
Perhaps if the British government spent less of taxpayers money on expenses and bonuses for staff, they’d have enough to pay British expats a fair pension. Pensioners who after all, have paid their National Insurance contributions and are not a burden on the taxpayer. Unlike some politicians I can think of…
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4 Responses to “British Expats Fight for Pensions”
Comment by James Nelson — September 7, 2009 @ 2:39 am
Pensions have been frozen since 1948, not just from 2001
Your picture of an elderly couple at Manly Beach may give the wrong impression. Unless people live in Manly they will only visit that beach when they can afford a holiday.
Comment by Peter Morris — September 7, 2009 @ 8:55 am
The National Insurance (NI) Fund which receives the NI contributions and pays out all state pensions currently has a surplus balance of over £50 billion. It can no longer be considered a Pay As You Go scheme with that much money in it. Because the NI Fund is ring fenced the government borrows that surplus for other government related expenditure. If pensioners win their case, then there is more than enough money in the NI Fund to pay their increases. The government could simply borrow the £500 million from somewhere else, like a bank. There would be no need for an increase in taxation and no need for a reduction in services.
Comment by Lisa Valentine — September 7, 2009 @ 10:37 am
Hi James, thanks for your comments on the story. You are quite right that pensions were first frozen in 1948 following the introduction of the National Insurance Scheme, however agreements were made with European countries, starting with France, to increase overseas pensioners pensions in line with UK pension increases. However for those pensioners living in Australia, South Africa, Hong Kong and Canada, there were no such agreements. Australian residents had their pensions topped up by the Australian government, but this stopped in March 2001. There was also a British pension reform in 2001, but pensioners from those countries affected did not benefit from it. So my usage of the term ‘frozen’ in that context is probably wrong.
As for Manly Beach, I’m impressed you were able to spot the location so easily! I’m not sure that the picture of an elderly couple at Manly Beach will give out any wrong impressions, but I’m prepared to be corrected on that one!
Comment by James Nelson — September 7, 2009 @ 11:11 am
Lisa. Your use of “frozen’ is quite right. In the context of occupational pensions it has an entirely different meaning, as you can find out from my article in Wikipedia.
UK pensioners who have an Australian pension do get some compensation from the Australian system, but it is not truly “topping up”. Until Australia terminated the agreement with UK, British pensioners arriving here were excused the 10-year residence rule. Those who arrived later have to wait for 10 years from the date of gaining permanent residency.