The government is facing pressure from campaigners who say the frozen pension policy is discriminating against retirees who are planning to relocate abroad. Under the scheme British Asian pensioners face the prospect of losing any future increase in their pension which would be in line with inflation.
A person over the retirement age would have the amount they receive kept at the rate it was at when they moved. Unlike those who stay and are guaranteed a yearly increase. Matters are complicated by the fact that those moving to EU countries would not face the freeze. Agreements with the European Union mean that the British government is required by law not to restrict pensioners retiring to countries such a Spain and Ireland.
British Asian pensioners would be penalised even though they may have contributed to the UK economy for decades. Pension Justice, an advocacy group for victims of the policy have pointed to the fact that retirees moving overseas would save the country money. They claim that the economy would benefit from fewer people using NHS services, age related benefits and other pension credits.
Abhik Bonnerjee is 72 and moved back to India to live with his family in 1997 when he was 54. Mr Bonnerjee now receives £87.30 a week. This is the rate of the pension when he passed his retirement age. However the current rate for those in the UK is £114 a week. This means he gets 24% less than he would if he had stayed in England.
Like the majority of British Asians he has spent decades contributing to the UK economy, having worked and paid into the system for 38 years. He started work in 1960 with Harland and Wolff. He then worked in Sheffield for Neepsend Steel for 11 years and even owned a restaurant in Doncaster for six years. Mr Bonnerjee spent his last 15 years in Britain with RHM in Nottingham. Now he feels he has to choose to leave his family or suffer because of an unfair financial penalty.
He is understandably upset about the situation, saying “The situation makes me very, very angry. The government are scaremongering, Steve Webb says it will cost a lot of money but it is only a tiny percentage of the pensions budget. The government should be doing more, especially for Commonwealth countries and MPs can’t explain why they are not.” He added “I would consider returning back to England in the coming years.”
The problem is made worse by the lack of awareness in the community. A survey by OnePoll found that two thirds (61%) are unaware of the changes and how it would affect them. Nearly half (40%) said it would impact their decision, while a quarter (24%) said it definitely would. The British Asian community is disproportionately affected since a higher than average number choose to return home in retirement. The same survey found that more than a third (38%) are considering it and one in nine (9%) say they will definitely return to their country of origin. One glimmer of hope for the campaigners is that the upcoming election may have an impact on the policy. Nearly Half of those asked (46%) may consider voting for a party that reversed the freeze.
