Half a Million UK Retirees Hit by ‘Frozen Pensions’ as DWP Rules Out Changes

Hundreds of thousands of British pensioners living overseas will continue to receive "frozen" state pensions, following an update from the Department for Work and Pensions (DWP).

The policy affects around half a million retirees who have moved to countries where the UK does not have a reciprocal agreement requiring annual state pension increases. Among the countries impacted are Canada, New Zealand, Thailand, and South Africa.

In response to a parliamentary question, Pensions Minister Torsten Bell said the government's position on overseas state pension uprating remains unchanged. He described the policy as a long-established approach that has been maintained by successive governments over many years.

According to Bell, UK state pensions can be paid anywhere in the world regardless of nationality. However, annual increases linked to the state pension uprating system only apply in countries where the UK has a legal obligation to provide them.

As a result, affected pensioners continue to receive the same payment amount they were entitled to when they first moved abroad. Over time, inflation reduces the real value of those payments, leaving some retirees receiving significantly less than current pension rates.

Campaign group End Frozen Pensions argues that the policy unfairly affects many individuals who contributed to the UK throughout their working lives, including thousands of military veterans and former public servants. The organization says some pensioners are receiving as little as £20 per week, compared with the current full new state pension of £241.30 per week.

The campaign continues to urge the government to reform the system, arguing that the policy could be ended through changes to UK legislation. However, the latest ministerial response suggests there are currently no plans to alter the longstanding arrangement.

Critics also warn that many people may be unaware of the financial consequences before relocating overseas, only discovering later that their state pension payments will not increase with inflation.

For now, the government maintains that its spending priorities remain focused on pensioners living within the UK, leaving the frozen pensions policy firmly in place.