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Scandal of frozen pensions |
From the
journal of the National Federation of Post Office and BT
Pensioners
(published
1999)
FROZEN OUT
One aspect of the rebellion by 80 Labour MPs last May ('99 ed) against proposals for changes in welfare benefits, that you probably didn't read about amidst acres of news coverage, was the rare appearance of a major, unresolved scandal.
A guillotine on further discussion of the Secretary of State's proposals was imposed, preventing MP Michael Colvin (Con.Romsey) from getting a debate on amendments to a bill he had tabled calling for an end to the freezing of almost half a million British state pensions. Co-sponsored by MP's Archy Kirkwood (Lib Dem Roxburgh & Berwickshire) and David Davis (Cons. Haltemprice & Howden), the measure had attracted support across the House. As Mr Colvin rose to speak, government tactics to deal with the rebellion cut off debate on the issue.
Readers may wish to read that paragraph again. Half a million state pensions frozen? That would cause a rebellion all right - not just in Parliament but throughout the land.
NO PENSION UPRATING
But there's no mistake. Despite making contributions all their working lives, 450,000 British pensioners have never received any uprating of their state pensions. Why? Because they've moved overseas. And unfortunately for them they chose the wrong countries. Somewhere in the EU like Spain, Italy or France? No, under EU rules British pensioners are treated like other EU residents and receive their pension increases. What about the USA? No, they get increases there too. Maybe Jamaica or Barbados? British pensioners are fine there - Commonwealth countries, of course.
Try somewhere more exotic. The Philippines, Bosnia-Herzegovina? No, still OK. Israel? No. So, where are all these deprived British pensioners?
MOST UNLIKELY PLACES
Give up? Ask yourself what are the most unlikely places to find British pensioners deprived of their rises? Jamaica and Barbados are all right so presumably they are in the rest of the Commonwealth? Wrong. that's exactly where most of 450,000 British expatriates live.
Britain does not pay pension increases to its pensioners in 48 out of 53 Commonwealth countries like Canada, Australia and New Zealand. Or to those in another 150 countries, either. As soon as they get their first pension payment in a 'frozen' country their uprating ceases - although 390,000 other expatriate pensioners in 'unfrozen' countries get the same annual uprating as pensioners residing in the UK. Many of these men and women served their country in war, worked hard to help it recover in peacetime (including some for the Post Office and BT) and contributed to UK national insurance and taxes all their working lives. It would cost less than 3/4 of 1 per cent (£275 million a year) of the pension budget to put the matter right. Placing this figure in perspective, fraud in the Social Security System costs the Treasury £7 billion a year.
The British state pension plan is more securely funded than any European scheme. Expatriate British pensioners, many of whom moved to Commonwealth countries to be near families who were encouraged by government to emigrate during the 1950s and 60s, feel that this security has been achieved partly on their backs. Thousands of elderly UK residents are prevented from joining relatives lest they become a financial burden because of the ever-reducing value of a frozen pension.
IT'S A SCANDAL
If anything deserves the description 'scandal' this does. The Canadian Alliance of British Pensioners - part of the World Alliance of British Expatriate Pensioners - have reminded us of these shaming facts. Federation members could support their fellow pensioners by giving their local MP an ear bashing. The government's stated principle is that: 'Everyone entitled to a UK pension should be able to get access to good quality welfare service wherever in the world they happen to be. Increasingly, many people who build up their pension entitlement in the UK move abroad when they retire. We mean to ensure that these customers get the best possible service.' You can tell your MP that a firm date should be set for the repeal of regulations that discriminate against frozen pensioners.