Campaigners say it would cost the UK Government just £63 million to unfreeze State Pension payments.
Campaigners say it would cost the UK Government just £63 million to unfreeze State Pension payments.(Image: Getty)
Over 400,000 British retirees living overseas say they have once again been left ‘out of sight, out of mind and out of pocket’ by the Autumn Budget, which Chancellor Rachel Reeves claimed contained a number of measures to improve ‘fairness’ for pensioners.
The Budget failed to address what campaigners claim is the ‘gross injustice’ that sees these pensioners denied the annual Triple Lock increases to their pension simply because they moved abroad to certain countries, often later in life to be near family.
This so-called ‘frozen pensions’ policy means that expat UK State Pensioners in certain countries, most of them members of the Commonwealth, see their UK State Pension ‘frozen’ at the level it was when first claimed abroad.
READ MORE: Nearly half a million older people not due State Pension pay rise in AprilREAD MORE: DWP confirms New and Basic State Pension weekly payment rates from April
Among those affected is 100-year-old Second World War veteran Anne Puckridge, whose Basic State Pension remains frozen at just £72.50 per week, rather than the current full rate of £169.50, simply because she moved in her late 70s to be near family in Canada, a ‘frozen’ country.
This is despite her wartime service and paying all her National Insurance Contributions during her long working life in the UK. Campaigners say the situation is made all the more bizarre, as this so-called ‘frozen pensions’ policy affects only some countries, most of them members of the Commonwealth.
If Anne had moved to the USA or a host of other countries including most of Europe, she would have received the annual uprating just as she would have if she had stayed in the UK.
Campaigners claim this ‘country lottery’ adds ‘insult to injury’.
In her speech, the Chancellor repeatedly underlined her commitment to fairness for pensioners, promising “not [to] turn a blind eye to unfairness”.
She pledged to index pre-1997 pensions in the Pension Protection Fund (PPF) and Financial Assurance Scheme (FAS) so that people who lost their schemes “through no fault of their own… no longer lose out as a result of inflation”, and confirming a 4.8 per cent rise in the State Pension in line with the Triple Lock.
Campaigners say that the sense of injustice has been compounded by the Chancellor’s decision to abolish access to Class 2 voluntary National Insurance Contributions for people living abroad from April 2026, forcing them onto the far more expensive Class 3 rate and blocking many from qualifying at all unless they have 10 years of contributions, up from three.
Justifying this change, the Chancellor said: “Taxpayers’ money should not be spent on pensions for people abroad who only lived here for a couple of years…”
Campaigners say this characterisation of overseas pensioners is deeply misleading considering a majority of state pensioners residing in ‘frozen’ countries, contributed fully and fairly while spending a majority of their working life in the UK, prior to retiring overseas.
Furthermore, they are not using the overstretched and costly NHS healthcare and long-term care services.
To make matters worse, in the case of pensioners who moved to ‘frozen’ countries, the vast majority (86%, according to End Frozen Pensions campaign polling) did so unaware that their UK State Pension would be frozen in this way.
Adding to the frustration, a recent Freedom of Information response from the Department for Work and Pensions (DWP) confirms that ending the frozen pensions policy on a going-forward basis would have cost the Chancellor just £63 million in the first year – the equivalent of around 0.04 per cent of the total State Pension budget.
Campaigners stress they are not asking for retrospective uprating, only that all UK pensioners receive annual increases on their existing pension from now on, regardless of where they live, in line with the approach already taken with countries such as the USA and EU states.
John Duguid, Chair of the End Frozen Pensions Campaign, said: “The Chancellor found the words, and the money, to help protect pensioners from inflation at home, while offering nothing to the hundreds of thousands of British pensioners overseas whose incomes are being eroded year after year.
“Once again, we are left out of sight, out of mind and out of pocket. And the fact that most of the affected countries are members of the Commonwealth adds insult to injury. The Government appears content to grow a chasm between its pensioners residing at home and abroad.
“This is a gross injustice, made all the more outrageous as the Government’s own figures confirm that fixing this injustice would cost the Chancellor a mere £63m in the first year, a drop in the ocean of the total pension spend.”
State Pension uprating
Under the Triple Lock the New and Basic State Pensions increase each year in-line with whichever is the highest between the average annual earnings growth from May to July (4.8%), CPI inflation rate in the year to September (3.8%), or 2.5 per cent. Additional State Pension elements and deferred State Pensions rise each year with the September CPI figure (3.8%).
The increase next year will see those on the full New State Pension receive £241.30 per week, while those on the maximum Basic State Pension would receive £184.90 per week.
It’s important to remember that the amount of State Pension someone receives depends on their National Insurance contributions. To receive the full New State Pension you need around 35 years’ worth, but this may differ if you were ‘contracted out’.
The full New State Pension will increase by around £574 from April 2026 – lifting it to £12,547 per year. The uprating leaves just £36 before the Personal Allowance income threshold of £12,570 is exceeded which would see more pensioners pay tax in retirement.
New State Pension payment rates 2026/27
Full New State Pension
Weekly: £241.30 (from £230.25)Four-weekly pay period: £965.20Annual amount: £12,547
Full Basic State Pension
Weekly: £184.90 (from £176.45)Four-weekly pay period: £739.60Annual amount: £9,614
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