State pension indexation

JohnWinder

There is a 'consumer price' (or similar) indexation of the state pension each year in April.
This does not apply to those receiving the pension in some overseas countries.

molerat

http://www.legislation.gov.uk/ukpga/2014/19/part/1/crossheading/postponing-or-suspending-state-pension

(3)Regulations may modify section 17(4) in relation to a person who has been an overseas resident during any part of the period for which the person's entitlement to a state pension has been deferred.

https://www.gov.uk/deferring-state-pension/if-you-move-abroad

If you move to a country that isn’t in the list, your extra payment will be based on the State Pension you’re owed at whichever is later of:

• the date you reach State Pension age
• the date you move abroad

So no deferral increase

xylophone

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/825396/state-pension-deferral-if-you-reached-state-pension-age-before-6-april-2016-extra-information.pdf


Does living outside the UK affect State Pension deferral?
If you normally live outside the UK you can put off claiming when you reach State Pension age.
When you finally do claim, DWP will work out how much State Pension you may get based on the amount you would have got if you had been claiming it at the time. This will include any yearly increases to the State Pension, even if you are living in a country where these increases don’t normally apply.

Once you have started to get your State Pension, you will only get yearly increases to your State Pension and your extra State Pension if you are living in certain countries. These are:
• countries in the EU and European Economic Area (EEA),
• Gibraltar or Switzerland, or
• countries with which the UK has an agreement on social security that allows yearly increases to be made (the UK means England, Scotland, Wales and Northern Ireland).
For more information see: https://www.gov.uk/state-pension-if-you-retire-abroad/rates-of- state-pension

JohnWinder

Thanks for the prompt comments.

xylophone

I'd suggest that you contact the International Pensions Centre.

https://www.gov.uk/international-pension-centre

https://www.gov.uk/deferring-state-pension/if-you-move-abroad

molerat

My second quote is for post 2016 SRA.

xylophone

https://publications.parliament.uk/pa/cm201516/cmgeneral/deleg2/160126/160126s01.htm



Regulation 4 inserts a new part 7 into the State Pension Regulations 2015, providing for restrictions on the uprating of the new state pension for persons living overseas. As hon. Members will be aware, the state pension is payable worldwide, but upratings for people who are not ordinarily resident in Great Britain are generally restricted to people living in the European economic area, Switzerland, Gibraltar or countries with which there is a reciprocal agreement that provides for uprating. That has been the policy of successive Governments for the past 70 years, and these provisions extend the same policy to the uprating of the new state pension. We are, however, introducing a change in the way in which we treat deferral in overseas cases.

Under the existing arrangements, when a person who has deferred their state pension while resident in a country where upratings do not apply finally claims, they will have both the amount of their weekly pension and their deferral benefit based on the current rate of state pension in force. That applies even though pension upratings would not have been received if they had not deferred their pension. The regulations remove that anomaly for those in the new scheme so that we treat people who defer their pension consistently, regardless of where they live.

jamesd

Which is messy. Consider a person not claiming who lives abroad for ten years after reaching SPA (or reaches SPA while abroad for ten years), returns to the UK (for how long?) and claims while in the UK. Uprating for all ten years because they were in the UK when they claimed?

The previous system was extremely simple with no potential for where you'd lived making a difference. Looks like added complexity to save benefit costs even more from people who are already badly treated.

JohnWinder

That was useful to have the parliamentary debate proceedings.

jamesd

The answer is yes for those who reached state pension age before 6 April 2016 and no from then on.

The anomaly being removed was that everyone got inflation increases - uprating - while deferring, wherever they lived. For those not deferring it depended on where you live. So the change made both depend on where you live.

JohnWinder

I have now found another source of information which is consistent with 'jamesd's' one line summary:
This is an explanatory memorandum to the new regulations and order 2016.