UK Pension Indexation post Brexit

UK Pension recipients in Australia, NZ, Canada, South Africa (and no doubt other former UK colonies) only receive a NON indexed pension.

This is of course bitterly disputed by those recipient because they paid in so why should they not be fully paid out similar to other / UK recipients. But that’s their ongoing battle. (I’m advised their contributions are quarantined and adequate, and thus not in competition with other UK socioeconomic demands).

Post Brexit (whatever the / if ever an outcome) what guarantees are there that those UK pension recipients who remain in France / EU will continue to receive indexed UK pensions?

I guess it depends on the phase the moon is in when the question lands on the tin pot dictator’s desk :crazy_face:
But other than than that, IIRC the indexing of pensions has little to do with brexshit but is a separate treaty.

If there is a transition period uplifts will happen durimg it. After that curremtly there is a statement of intent from the UK. Nothing more.

it’s all to do with reciprocity between the UK and other countries in / not in the EU - current status

(https://www.gov.uk/government/publications/state-pensions-annual-increases-if-you-live-abroad/countries-where-we-pay-an-annual-increase-in-the-state-pension)

At the embassy meeting in Poitier it was stated that the intent was there and of course the French government would want their citizens to also continue to get the increases whilst in the UK.

good morning all. I have not been following the pensions discussions so appologise if this has been covered. I have just received a letter from UK pensions saying that three years after the UK leaves the EU my pension will cease to benefit from an annual increase. Leaving asside the question of whether the UK will really leave the EU or will leave in name only, does anyone have any Idea just what the ‘official’ rationale is for stopping this index linking after three years is.?
Usually, even if one disagrees with something like this, it is possible to at least understand the other point of view as towhy it is being implemented, but in this case I cannot. They have already robbed many of us of pension payouts by increasing the age of elegibility, now this.
Based on current inflation rates, I wonder if anyone has calculated how long it will take for our non indexed pensions to be almost worthless;
regards
geoff

As our name starts with W we will be amongst the last to hear this joyful news.

It is so marked on the UK Gov pages - and I cannot figure out why they intend to stop it. Correction, on the page they say it (annual increase) will be open for negotiations after 3 years (negotiations with whom, I do not know) :thinking:

The three years is if there us no deal I think. And apparently the reason given is reciprocal arrangements need to be made with EU vountries-why I have no idea!!

Trade deals probably…

What have Trade Deals got to do with my Pension ??? :thinking:

Ah yes, absolutely nothing… but possibly another drip, drip in the Chinese-Torture that BJ is visiting on everyone… :face_with_raised_eyebrow:

You’re right, absolutely nothing! The agreements will be reciprocal agreements on social security entitlements.

No apologies for resurrecting an old thread because (if I read it correctly) we will get the annual increase, even those not covered by WARP.

I suppose this will affect only a small (but increasing) number of us. It’s a way off for me, but reassuring for budgeting purposes.

Unless I’ve misunderstood …

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I’m fairly sure you haven’t misunderstood. Pension increases seem to be dependent on which country you are living in, not the basis on which you are resident. France at least (and I think the whole of Europe) is included in the list of countries that get the increase. Places like Canada and Australia don’t.

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I’ve never understood the rationale for this, it’s bonkers.

I think the UK pensions people have set up “deals” with individual countries over the years but never managed it with Canada or Australia (and a few others). It’s completely independent of Brexit since it has nothing to do with any other treaties.

Yes, but…

Why on earth would it need to be reciprocal?

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I’ve never understood that either :roll_eyes:

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I’ll give you my take on why reciprocal agreements are struck, though others may have a different view. Generally when 2 countries agree to create a reciprocal social security/pension agreement, it is for the best of reasons. They want to ensure that those of their citizens who have worked in both countries do not lose out in terms of benefit entitlements, especially pensions, through failing to meet qualifying periods to obtain those benefits.

For example if Country A requires 10 years of social security contributions to qualify for a pension but the individual has only worked 8 years in A , but also 4 years in Country B they will not, on the face of it get a pension. However if periods spent working in Country B are included in A’s qualifying periods, under a reciprocal agreement, the Individual may then qualify for a pension in one, or possibly both countries. The EU has a multilateral agreement to address this scenario.

However some countries do not like the concept of entering into reciprocal agreements, especially if they think they may end up paying out more in benefits than receipts of contributions. This could arise if population flows are mainly skewed inbound to their countries. I believe this has historically been the case with Australia for example.

I can understand that sort of reasoning, @George1 but what is weird about this is when the country in which the pensioner is resident does not in any way contribute to the pensioner’s income, which is paid directly by the UK in this case. I know someone in Canada, for example who retired, started drawing his State pension, moved to Canada, continued to draw his UK state pension but now it will never inflate so will be completely worthless in a few years time.

That’s all very well but each state still pays a pension based on contributions in that state so the behaviour of any other state doesn’t affect that - and lack of index linking because you happen to retire to a particular place is just petty.

In fact for persons who have only ever contributed to a UK pension it seems both petty and  punitive.

It’s just an excuse to avoid paying benefits earned.

Australia and NZ have been reported on here as completely refusing to pay someone their earned pension if they take up residence somewhere else.

Which seems even worse. If I choose to live in a more expensive country than the UK for overall daily living expenses, which France definitely is, then that’s my problem. It shouldn’t affect the general rate of payment pensions are being paid at, I should receive whatever that general UK rate is if I’ve earned it.

I am sure most people resident elsewhere who draw a UK pension are likely to be in more expensive countries to live in, than the UK so most are already losing out. Plus they take the foreign exchange rate risk. And if you chart it over the past 100 years, Sterling has declined and is still declining.