The Law Lords have indicated that it will take until around February 2005 for them to review the law relating to pensions paid to pensioners living abroad. Annette Carson who moved from the UK to South Africa in 1989 (now 63 years old) had her case denied in the Court of Appeal when she claimed the Government discriminated against pensioners, depending which country they decided to live in.
Mrs Carson's case is now a test case for the Law Lords that could potentially affect around half a million pensioners around the World.
Our View
UK State Pensions are paid to over a million pensioners around the World. Most are paid as if the person lived in the UK with annual inflationary increases. But, for some people, pensions are paid at the level they started at, without any inflationary increases.
It is unfair for some people to receive an inflationary linked pension and others not, just because of where they live. However, too many people moving abroad, state pensions are not the major part of their income and they make the sacrifice.
We would urge anyone thinking of retiring abroad to check out their State pension and any associated benefit entitlements before deciding to leave. If you are likely to rely on your State pension, make sure you are moving to a country where the UK will allow inflationary increases.