Simon Read: What made the minister change his mind about the retired Britons with frozen pensions?
Simon Read is Personal Finance Editor at The Independent. He edits the Saturday Your Money section and writes the Daily Money column and Wednesday’s Midweek Money section in i newspaper. He also writes for the news and business pages of the Independent and i newspaper and is a regular money commentator on TV station London Live. He has won numerous awards including Consumer Finance Journalist of the Year.
Friday 24 January 2014
Regular readers will recall my articles about overseas pensioners and the anger felt by around half a million of them who have had their state pensions frozen.
Where people feel they are getting a raw deal, the controversy is a matter of geography – retire to the wrong country and your pension is frozen at the rate it was when you left Britain. So anyone moving to Canada, for instance, has their state payout frozen. Meanwhile those moving just over the border to the US enjoy annual increases just as if they'd stayed at home.
Many of you have written in with your views. Some feel that it's pensioners' own fault: they knew the situation before they left the UK and so shouldn't complain now. Others presume that the pension shortfall must be being made up in the countries that people have moved to.
On the latter point the answer is no, as far as I can find out. On the former point, I have been sent several emails by people who were not told by the Government that their pension would be frozen. They only actually discovered that this would happen when they didn't get their annual increase.
My view is that it's about fairness. All the pensioners involved paid their national insurance contributions during their working lives. Part of that money that they handed over to the Government would, they were led to believe, give them full rights to a state pension when they retired.
For the half a million or so pensioners who moved abroad to the "right" country, the state pension has been paid out as promised. For the other half million or so who unfortunately picked the "wrong" country, payouts have ended up being much smaller than they expected.
All they want is parity with their neighbours. I think they have a fair case so, when I met the pensions minister Steve Webb this week, I put it to him.
I was hopeful of a positive response as, when he was in opposition, the Liberal Democrat MP tried to insert a clause in the then Pensions Bill that would have abolished pension freezing.
At the time, 2004, he had said: "The purpose of the new clause is to provide that the pensions of those who now live overseas should be annually uprated, wherever they live.
"The moral claim rests on the fact that we have a contributory pension system. We ask people to make contributions all their life to accrue an entitlement. Why should that accrued entitlement vary according to where they choose to live?"
A decade later I trusted that he would be of similar mind. I was sadly mistaken. "It is a question of cost," he told me, adding, as if to shut me up: "We've fully debated the issue in Parliament."
When challenged on his earlier support for those with frozen pensions he blithely said: "Look, the fiscal position was different in 2004 than in 2014."
I don't know what has changed his mind. Mr Webb seems a decent person, but casting aside a cause he'd previously fought for looks like the act of a politician more concerned with his career than justice. Maybe he's got one eye on next year's election and wants to keep in with his coalition partners in the Tory party.
Or maybe the modern-day Sir Humphreys in the Department for Work and Pensions have made him believe that his role is to protect the public purse, rather than look after the public wellbeing.
Well, here's a warning to Mr Webb – and whoever takes over as the next pensions minister: this issue will not go away. Pensioners who feel badly let down by the British Government will continue to fight for their cause.
And with next year's election in mind, all politicians would do well to take note of a survey conducted this week by the International Consortium of British Pensioners. About 60 per cent of those asked agreed that pension freezing is not a good way to treat British nationals who have contributed to the economy by paying taxes and national insurance for a number of years.
And, crucially, nearly half those polled said they would vote for a political party with plans to unfreeze the pensions. You have been given fair warning, Mr Webb.
Npower customers waiting for complaints to be resolved must be given free energy, Ofgem rules
Switching your current account? Pick one that reflects the way you run your finances
Bargain Hunter: Win a trip to one of the Modern Wonders in a new 'seven-day' prize draw
10 tips for taking out a personal loan
Money: If you love her, share the bills
- 1 Kenya President Uhuru Kenyatta clashes with President Obama on LGBT equality: ‘Gay rights is really a non-issue’
- 2 37-year-old black woman found dead in police custody
- 3 Five-year-old boy forced classmate to simulate oral sex at primary school, claims mother
- 4 Game of Thrones season 6: New toy line suggests Jon Snow is not among the dead
- 5 Denmark bans kosher and halal slaughter as minister says ‘animal rights come before religion’
The 9 charts that show the 'left-wing' policies of Jeremy Corbyn the public actually agrees with
Labour leadership contender Jeremy Corbyn says 'we can learn a great deal from Karl Marx'
The last thing Labour needs is a leader like Jeremy Corbyn who people want to vote for
What the Labour party could look like under Jeremy Corbyn
I am the Jeremy Corbyn supporter that many will tell you doesn't exist
Public anger after French sunbather beaten up by gang for wearing a bikini in Reims park
iJobs Money & Business
£40 - 45k (DOE) + Benefits: Guru Careers: A Research Associate / Research Anal...
£20000 Per Annum: The Green Recruitment Company: Summary: The Green Recruitm...
£30000 - £35000 per annum + benefits : Ashdown Group: Finance Accountant - Fin...
£90000 - £98000 per annum + benefits : Ashdown Group: A truly exciting opportu...
Day In a Page
A few miles from the seaside at Perranporth, this four-bedroom farmhouse sits amongst nine acres of idyllic grounds - including a lake and two barns used as holiday lets.
In the pretty market town of Bungay, this grade II-listed Mill House is arranged over four floors, offering four bedrooms and three reception areas.
This first-floor flat comes with two bedrooms, an impressive open-plan reception room and two lovely roof terraces.
This five-bedroom home comes with a range of outbuildings including a large barn which could be converted into a self-contained granny-flat or rental.
Moored at Taggs Island and reached via a pretty garden, this two-bedroom houseboat has a vaulted reception room and skylit garden studio - currently a beauty salon.
On the edge of the city, this six-bedroom home comes with an outdoor swimming pool and a large garage block that has annexe potential.
A contemporary house spread over three storeys, this three-bedroom detached home has large sliding doors that open out to the River Quaggy.
Moored in Chelsea's Cheyne Walk, this houseboat offers two double bedrooms and a teak deck that's ideal for al-fresco dining.
This former village bakery, dating back to the 17th century, is now a three-bedroom detached home just a few miles from the East Sussex coast.
On the picturesque Isle of Man, this four-bedroom character home has a ground-floor shop that's currently run as a newsagents and a flat that would make an ideal holiday let.
In a new collection of flats, this first-floor two-bedroom apartment offers ample entertaining space and a prime view of Furze Green from a private balcony.
This three-bedroom stone-built cottage currently trades as the village store with a restaurant in the annexe and family accommodation on the upper floors.
Previously two semi-detached properties, this five-bedroom home is spread over three floors with a large breakfast kitchen, orangery, office and gym on the second floor.
This five-bedroom home enjoys countryside views over the Blyth estuary to Southwold, offering flexible living space with a ground-floor annexe - ideal for use as a holiday let.
Close to the market town of Eye, this four-bedroom detached home offers a double-height living room which takes the place of the original, 19th-century, chapel nave.
Dating back to the 19th century, this four-bedroom home needs modernising. Spanning three storeys, the red-brick house has a fireplace, a small terrace and a cellar.
Just outside of Cambridge, this single-storey home offers three double bedrooms, a living room with vaulted timber ceiling and ladder steps that lead to a mezzanine study area.
This six-bedroom Georgian home is on three floors with open fireplaces, a two oven Aga, an annexe, and cottage gardens with outbuildings and a car barn.
A former coach house, Glebe Farm Stable is now a three-bedroom cottage with a double car barn, an attached office, kennels and an outbuilding that's currently used as a gym.
Located beside an impressive Victorian viaduct, this four-bedroom home has an open-plan living area that is glazed on two sides, with skylights and high ceilings.
A former furniture workshop, this three-bedroom home has high ceilings and painted brick walls, in a village setting only fifteen miles from the coast.
This five-bedroom stone townhouse features a pine staircase and an Inglenuk fireplace, double doors from the lounge give access to an enclosed courtyard.
This five-bedroom, detached home blends traditional and modern design; the sleek kitchen features a gas hob and oven set within an exposed chimney breast.
Capitalise on the fabulous views of Trevone Bay by taking two homes and creating one spacious boutique B&B. Just a cliff-top walk from Padstow.
Surrounded by woodland, this five-bedroom manor house has plenty of outdoor storage space in the form of three converted loose boxes, two smaller outhouses and a woodstore.
This six-bedroom home is set amongst three acres of grounds. Currently a large family home, Clift Hill has potential to make a B&B or countryside retreat, subject to change of use permissions.
This Grade II-listed three-bedroom home is situated on a private road, just a short walk from the sandy beaches of Frinton-on-Sea.
Less than five miles from Malmesbury, this four-bedroom cottage comes with equestrian facilities and gardens that extend to approximately three acres.
Spanning three storeys, this late-Victorian five-bedroom farmhouse is a spacious family home with a modern interior and B&B potential.
With an original church arch, this triplex one-bedroom church conversion has a light, spacious, feel and comes with a secure off-street parking space.
This recently-refurbished three-bedroom home has bi-folding doors that lead out to a decked seating area - ideal for alfresco dining this summer.
Well-located for coastal walks and popular restaurants, this detached four-bedroom home offers views over farmland, to the Solent, the Purbecks and Bournemouth.
If you love high ceilings, school conversions like this one are bang on the money. This two-bedroom flat is minutes from Burgess Park and the foodie haven at Borough Market.
Set within a church conversion in Bermondsey, this two-bedroom maisonette combines existing features, such as original arches and brickwork, with a contemporary finish.
This four-bedroom Edwardian home offers a combination of original features and contemporary design after a renovation by the current owners.
This four-bedroom home offers a vaulted ceiling in a breakfast room that's ideal for summer entertaining with doors that open to the patio and garden.
On the market for the first time in more than 50 years, this six-bedroom home is a project with vast potential - spread over three floors of living space.
Surrounded by rolling countryside, this four-bedroom barn conversion comes with a self-contained, one-bedroom annexe that could serve as an office or a holiday let.
Located near Harrogate town centre, this five-bedroom Victorian terrace is arranged over three storeys while a current study serves as an optional sixth bedroom.
A ground-floor flat in a country house, located a mile from Sway; this two-bedroom home would make an ideal weekend retreat on the edge of the New Forest.
On a popular residential lane in Caterham on the Hill, this four-bedroom family home offers a secluded garden and a convenient location for local schools and public transport.
Just a short walk from Westerham green, this three-bedroom cottage has a light kitchen with exposed brickwork and double doors that lead to a south-facing garden.
In a prime spot opposite the River Thames, this one-bedroom flat has an 18sq ft reception room with glass doors that open out to a private terrace.
Set in the hills above Llanwrda Village, west Wales, this 18th-century three-bedroom farmhouse has holiday-let potential from a separate barn conversion and annexe.
This charming end-of-terrace townhouse is arranged over three floors, with two double bedrooms and a private courtyard garden located at the rear of the property.
Located in the University area, this semi-detached five-bedroom home is arranged over three floors - there's even a rear garden and off-road parking too.
Only a few minutes' drive from the charming town of Marlow, this two-bedroom home sits on the private riverside estate of Harleyford.
This detached four-bedroom home in Middleyard is arranged over two floors, with features that include a wood-burning stove and bespoke oak staircase.
In a row of eight detached Georgian residences, this five-bedroom home offers views of The Sound, Mount Edgcumbe and Cornwall from its impressive veranda and full-length balcony.
If you love cooking for friends this two-bedroom flat - complete with views of the iconic Battersea Power Station and an open-plan kitchen/dining area - will go down a treat.