British expatriates who have retired to some areas of the world will not receive UK pensions increases that are aligned with inflation, Foreign Minister William Hague announced yesterday.
UK retirees living in Australia, New Zealand, Canada and South Africa, who have not received any pension increases since they relocated, yesterday received the bad news that they will not be receiving such increases in the near future.
Speaking in Sydney on Thursday, Mr Hague said the UK’s current economic woes meant there it was not an option for the government to change the expat pension policy: “As a new government in Britain we have inherited a huge budget deficit, which we’ve cut by a quarter so far but is still more than 8 per cent of our gross domestic product,” Mr Hague said. “So there is no prospect of us being able to take on a major new area of expenditure.”
It is currently estimated that it would cost the British government about $540 million to achieve pension parity. However, the International Consortium of British Pensioners, which has been campaigning on behalf of impacted expats for the last twenty years, argue that this constitutes less than 1% of the UK government’s current pension fund.
Mr Hague’s latest comments will come as bad news for the hundreds of thousands of British expatriates who are living in Australia, New Zealand, South Africa and Canada. The International Consortium of British Pensioners argue that the rules are unfair, especially given the fact that expatriates living in other areas of the world, such as the European Union, the USA and the Philippines, receive pensions that are fully indexed.