Annual increments are linked to the estimated average annual increase in salaries, i.e. are less than the U.K.'s official annual c.p.i. inflation rate.  They are not payable when residing outside the U.K. and certain countries with which the U.K. government has reciprocal social security agreements (notably the E.U., the U.S. and Turkey; and, in S.E. Asia, the Philippines).

 

Disadvantages for the U.K. Exchequer of its retired nationals living abroad:

Their FX sales of GBP for a foreign currency tend to devalue the British currency in the same manner that foreign imports do.  Those with larger pensions or savings and making larger overseas investments, whether in real estate or other, will obviously have a greater impact.

 

Those of my generation will recall that we once had foreign exchange controls where no more than £50 could be taken out of the sterling area.  With the global economy in increasing turmoil and governments under pressure, such things might reappear.  Let's hope not!

 

Advantages for the U.K. Exchequer of its retired nationals living abroad:

The government incurs no health-care costs, which tend to increase disproportionately once people have passed retirement age.  Moreover, health costs are not incurred during a temporary return to the U.K. of a British citizen no longer considered a U.K. resident.  (This advantage would be less in the case of those whose means would have enabled them to forego N.H.S. services)

 

Savings on certain other costs may also need to be considered.

 

The number of DWP pensioners living abroad in countries where the annual increment is not payable:
 453,000          www.dailyrecord.co.uk     www.retirementline.co.uk

 

One question the government's budget office needs to ask itself is:
What additional costs might have to be met if some of those living abroad for years on "frozen" pensions are eventually forced by inflation to return permanently to Britain in order to meet their basic living expenses.
Perhaps a scheme is being put in place to accommodate their homecoming?  Some hope!

 

In view of the largesse expended on illegal immigrants, many of whom are clearly not refugees by any normal definition, plus ramping up plans to engage the Russian Federation on the Ukrainian battlefield, it seems there is surprisingly little shortage of funds available.

 

Was there a query?

 

 

I think that you meant to say "They are not payable when residing outside the U.K. EXCEPT certain countries with which the U.K. government has reciprocal social security agreements (notably the E.U., the U.S. and Turkey; and, in S.E. Asia, the Philippines).

 

On 5/25/2025 at 8:14 PM, hotandsticky said:

Was there a query?

 

 

I think that you meant to say "They are not payable when residing outside the U.K. EXCEPT certain countries with which the U.K. government has reciprocal social security agreements (notably the E.U., the U.S. and Turkey; and, in S.E. Asia, the Philippines).

 

Your version is clearer.  I intended the preposition 'outside' to be shared between the u.K. AND certain countries ...

On 5/25/2025 at 2:03 PM, ericbj said:

Annual increments are linked to the estimated average annual increase in salaries, i.e. are less than the U.K.'s official annual c.p.i. inflation rate.

 

They increase by the so called "triple lock" which consists of inflation (CPI), average earnings growth, or 2.5%.  The highest of these figures is used.