450,000 pensioners set to miss out on payment increase from this month | Retirement | Finance

Pensioners are being alerted to the news that nearly half a million individuals may not benefit from the upcoming rise in pension payments. After taking effect on April 7, the New State Pension increased by 4.1%, translating to £921 every four weeks for the 2025/26 fiscal year, whilst the Basic State Pension climbs to £705.80.

Yet, the Daily Record has highlighted an issue affecting roughly 453,000 pensioners living abroad. Due to the absence of a bilateral agreement with the UK, for example, former residents now living in Canada do not receive annual uprating of their state pension.

This is despite having fulfilled their National Insurance Contributions requisite for pension eligibility. Advocates for the nearly half-million expatriates are optimistic that the election of Mark Carney as Canada’s Prime Minister might spell the end of the so-called “frozen pensions policy”.

Having spent a significant segment of his career in Britain, including a notable tenure as the Bank of England’s Governor, campaigners under the End Frozen Pensions Campaign underscored the irony that Carney, now 59 and back living in Canada, could himself qualify for a UK State Pension.

Nonetheless, he faces the same predicament as other Canadian-based UK pension recipients: having their State Pension frozen at the value it holds upon their initial claim.

Campaigners have highlighted that the UK Government’s long-standing policy has resulted in hundreds of thousands of UK State Pensioners missing out on the annual payment increase due to retiring overseas to certain countries. This primarily affects Commonwealth countries, including Canada and Australia, while retirees residing in the USA or EU countries receive the same State Pension considerations as if they had stayed in the UK.

Edwina Melville-Grey, Chair of End Frozen Pensions Canada, commented to say: “We don’t imagine for a moment that Mr Carney will be reliant on whatever UK State Pension he might be entitled to. However, we know for sure that many thousands of the UK State Pensioners living in affected countries, including those in Canada, see their UK State Pension as a vital lifeline helping them through arduous times.

“We know that he has many immense challenges on his desk right now and wish him well in meeting those. But we hope he will be able, when the time is right, to meet with our lead campaigner on this issue, 100-year-old Anne Puckridge. Her situation embodies the injustice of this scandal.”

Anne made a trip to the UK in December 2024 to lobby the UK Government, requesting a meeting with Prime Minister Sir Keir Starmer on the matter. However, her invitation was declined.

For over two decades, the 100-year-old Second World War veteran, who served in all three armed forces, has been receiving a meagre State Pension of just £72.50 per week – shockingly less than half the £176.45 she would be entitled to come April 2024 had she not relocated from the UK when she was 76, despite having worked in Britain throughout her life.

It is a similar situation for many other pensioners as well, with reports stating that about half are receiving £65 weekly or even less. The plight deepens with campaigners highlighting cases where some folks are managing on as little as £20.00 a week.

John Duguid, Chair of End Frozen Pensions International, commented on the dire need for change. He said: “Simply more needs to be done to address the ‘frozen’ pensions policy in diplomatic settings, and the election of Mark Carney as Canada’s Prime Minister paints the perfect opportunity to do so.

“The current political appetite surrounding trade and negotiations further reinforces the point that the cost to unfreeze pensions is extremely modest and will be an essential lifeline to many affected pensioners who are struggling to make ends meet.”

The battle against “frozen pensions” is spearheaded by the International Consortium of British Pensioners (ICBP), representing around 453,000 expat retirees. They lead the End Frozen Pensions campaign, which seeks to “end the injustice” faced by British citizens living abroad whose State Pensions fail to increase annually with the Triple Lock each April.

The Canadian Alliance of British Pensioners’ analysis suggests that all these frozen State Pensions could be aligned with the current State Pension pay rates by the new Labour Government for £50 million. Their analysis reveals that State Pension payments to frozen countries only account for 1.3% of the UK Government’s total annual expenditure.

More information about the End Frozen Pensions Campaign can be found on their website.