Nearly half a million British retirees living overseas remain affected by the UK’s “frozen pensions” policy, which prevents annual state pension increases for people residing in certain countries. The Department for Work and Pensions (DWP) has now reiterated that there are no plans to change the approach in the near future.
The issue affects pensioners who moved to countries where the UK does not have a reciprocal agreement covering state pension uprating. As a result, many retirees continue receiving the same pension amount they were entitled to when they left the UK, even as inflation has reduced the value of those payments over time.
Government Maintains Existing Overseas Pension Policy
According to reports, Pensions Minister Torsten Bell responded to a parliamentary question about the impact of frozen state pensions on UK pensioners living abroad. In his response, Bell emphasized that the policy has existed for many years and continues to reflect the position of successive governments. “The UK’s policy on the up-rating of the UK State Pension for recipients living overseas is a longstanding one,” Bell said.
He also noted that the UK State Pension is payable worldwide regardless of nationality. However, annual increases are applied only where the UK has a legal obligation to do so through reciprocal arrangements or other agreements.
According to Bell, governments have consistently supported this approach while prioritizing pension-related spending for people living within the United Kingdom. He stated: “This approach has been supported by successive governments, over many years with priority given to those living in the UK when drawing up expenditure plans for additional pensioner benefits.”
Countries commonly cited as being affected by the policy include Canada, New Zealand, Thailand, and South Africa. Pensioners who relocate to these nations continue receiving their pension, but they do not benefit from the yearly increases linked to the state pension uprating system.
Campaigners Highlight Long-Term Financial Impact
The practical effect of the policy is that pension payments remain fixed at the rate a person was receiving when they first left the UK. Over time, inflation reduces the purchasing power of those payments, creating significant differences between pensioners living in different countries.
According to the End Frozen Pensions campaign, some retirees are currently receiving as little as £20 per week. By comparison, the full new UK State Pension stands at £241.30 per week.
The campaign argues that many of those affected contributed throughout their working lives in Britain. It states that the group includes more than 60,000 veterans as well as former civil servants. The organization has described the frozen pensions policy as “a political choice and an accident of history,” adding that it could be ended through domestic legislation.
Another point raised by campaigners concerns awareness of the policy before relocation. According to the End Frozen Pensions campaign, 86% of retirees affected by frozen pensions were not informed that their state pension would stop receiving annual increases before they moved abroad.
The government’s position remains unchanged, while campaign groups continue to call for reform. Pensioners seeking to understand whether they are eligible for annual state pension increases can consult the list of countries covered by uprating agreements, which is available through the UK government’s official website.
