Expat pensioners lose court battle

The UK government is this evening breathing a sigh of relief after winning a European Court of Human Rights battle which could have resulted in a £500 million a year additional bill for the UK state pension. The case revolves around a number of expats who have moved overseas to places such as Australia and Canada and are currently only receiving the pension payable upon their retirement in the UK without any increases to take in annual inflation.

If the court action had been successful this would have brought up to 500,000 UK pensioners a significant increase in their state pension and cost the government hundreds of millions of pounds. At the moment there are a number of countries in which UK expats are receiving inflation proofed state pensions but there are also many other countries in the world where this is not the situation. It is difficult to understand how you can pay into the UK pension system, move overseas and depending upon where you are living receive either a basic state pension, which is fixed at the day you retired, or an inflation proofed pension, which can significantly boost pension payments.

While we may see further legal challenges in the short to medium term the fact is that the case looks to be dead and buried and many expat pensioners will be very disappointed this evening.