State Pension  

Govt secures pension uplift deal with 5 countries

Govt secures pension uplift deal with 5 countries

The government has secured deals with five EEA countries that will ensure expats continue to receive state pension uplifts after 2023 regardless of what happens with Brexit.

According to an update published yesterday (October 29) by the department for Work and Pensions, UK citizens living in Ireland, Switzerland, Norway, Iceland and Liechtenstein have guaranteed uplifts to their state retirement benefits after 2023.

Of these only Ireland is a member of the EU. The other four participate in the single market, with three of them - Iceland, Liechtenstein, and Norway - being part of the European Economic Area and Switzerland being a member of EFTA.

When the UK withdraws from the EU, the most likely legal position is that it will also leave the EEA and therefore will not be able to participate in the single market and has to negotiate deals with countries individually.

The government has already committed to increasing the pension benefits paid to Brits living in EU countries for the years to March 2023, according to the triple lock rules.

But it is uncertain what will happen in these countries after that date.

Under the triple lock, the state pension increases each year in line with whichever is the highest: consumer price inflation, average earnings growth, or 2.5 per cent.

During the three-year period, the UK government plans to negotiate a new arrangement with the EU to ensure that uprating continues thereafter, the DWP stated.

Thérèse Coffey, secretary of state for Work and Pensions, stressed at the time that pensioners in Europe “who have paid into the system for years deserve peace of mind over their future finances”.

She added: “Not only are we providing much-needed reassurance for hundreds of thousands of retirees, we’re ensuring we are fully prepared for leaving the EU on October 31.

“No matter the circumstances of Brexit, we’ve made sure that pensioners do not need to take any action to continue receiving their hard-earned state pension.”

The DWP has established a dedicated call centre to answer any questions from those affected.

maria.espadinha@ft.com

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