Expat Pensioners Not Entitled to Inflationary Increases

Excluding expatriate pensioners from index-linked pension increases that are available to UK residents does not amount to discrimination, according to a recent ruling of the European Court of Human Rights.

The case arose following a 2005 judgment by the House of Lords. Writer Annette Carson, who had been living in South Africa for 15 years, claimed pension rights equal to those of UK-resident pensioners. Ms Carson turned 60 in 2000 and was then entitled to the same basic pension she would have received had she been living in the UK. As she is resident in South Africa, however, she has not received subsequent index-linked increases.

UK pensioners ordinarily resident abroad are not entitled to the annual increase, unless the country in which they live has a reciprocal arrangement with the UK, which South Africa does not. All EU countries do have reciprocal agreements, but nearly 200 other countries do not.

The House of Lords did not support the claim and so Ms Carson and 12 other UK nationals applied to the European Court of Human Rights, claiming that the UK authorities had discriminated against them, contrary to Article 14 of the European Convention on Human Rights, which prohibits discriminatory treatment on a number of grounds. The Court agreed with the UK Government and courts that the same high level of protection against discriminatory treatment on the grounds of race or sex was not needed in this case. Furthermore, the UK had taken steps to inform its residents moving abroad about the absence of index-linking of pensions of those resident in some countries.

The European Court therefore held that there had been no violation of Article 14.

The legal, economic and other implications of moving to another country can be very far reaching. Anyone thinking of taking such a step should consider their position carefully and take professional advice before proceeding.