The International Consortium of British Pensioners (ICBP) comprises three member organisations: British Pensions in Australia (BPIA), the Canadian Alliance of British Pensioners (CABP) and the British Caribbean Pensioners Association (BCPA) plus numerous individual members from around the world. ICBP efforts are funded by their members via membership dues and voluntary contributions. All Directors are non-paid volunteers whose sole aim is justice for the many deprived British pensioners.
An All Party Parliamentary Group on Frozen Pensions (APPG) is ICBP's voice in the UK Parliament. ICBP believes that all UK state pensioners – no matter where they choose to retire overseas – ought to be paid the pension that they have contributed towards and are rightfully entitled to receive.
In the early days of National Insurance, 65 years ago, the UK state pension was not indexed for pensioners abroad. This was at a time of severe currency restrictions. From 1950 to 1980, the UK negotiated reciprocal agreements on an individual country by country basis. Many countries did not have systems in place which fitted with the U.K.’s requirements under the proposed reciprocal agreements. Subsequently, some countries approached the U.K. Government to enter into reciprocal agreements, but the UK had unilaterally stopped signing any new agreements in 1982. Since then, the U.K. has refused to sign any agreements covering pension indexing. As a consequence, they only annually index U.K pensions in those countries that they had signed reciprocal agreements or other treaties with the U.K prior to1982. The U.K. is now the only country in the OECD which pays its pensioners differently, based on country of residence. Even without a reciprocal agreement, Canada, Australia and other foreign countries provide annual increases to their pensioners who live in the U.K.. The U.K. Government has confirmed that no international agreement is required for them to unfreeze pensions. It is simply a matter of domestic regulation which they refuse to contemplate changing.
A female pensioner aged 90 living on a frozen pension gets £41.15 per week, whereas a pensioner retiring today receives £122.30 up to £155.00 per week. The different amounts are based on age alone and nothing else. Every pensioner, frozen or not, has contributed, by law, the same amount for his or her pension and ICBP believe, therefore, all should receive the same amount in return. How has the U.K. responded to the frozen pension’s issue? Typically, U.K. politicians are in favour of up-rating when in opposition but change their minds once in power. The only reason given is cost, despite the U.K. Supreme Court ruling in 2013 that discrimination cannot be justified on cost alone.
The annual cost is about 0.7% of the total pension budget for 2015, a miserly £590 million out of £91.8 billion currently spent on pensions each year. The National Insurance Fund is regularly in surplus and could easily afford the cost except that the Government keeps borrowing from it to cover other funding requirements.
There have been several attempts over the years to persuade the U.K. government to reconsider their unjust policy. A Early Day Motion (EDM) in 2016, which may have succeeded, fell because of the unexpected General election. There will be further opportunities for EDMs in the future. The best opportunity is Brexit with the U.K. Government having committed itself to up-rating British pensions in the EU despite the lack of reciprocal agreements with 20 of the 27 countries which form the EU. If them, why not us? Also, the U.K. wants to enter into trade agreements with Commonwealth countries. Commonwealth Governments need to insist on pension up-rating be provided to all UK expatriates before entering into any new trade agreements with the U.K..
The ICBP believes that strong action is necessary. The U.K. Government’s refusal to unfreeze pensions is negatively impacting on the GDP of many Commonwealth countries. ICBP believes that the frozen pension issue should be raised at the highest levels of the U.K. Government and, if necessary, tied to other relationships and agreements with the U.K.. Commonwealth Governments should demand full Social Security bilateral agreements with the U.K.. The ICBP is applying pressure to Governments in all frozen pension countries, the Commonwealth in particular, to get the U.K. Government to change its unjust policy. Through its U.K. contacts, the ICBP also is continuing to recruit U.K.MPs to join the APPG and to support a change in the law.