HL Deb 07 April 1982 vol 429 cc220-2

11.10 a.m.

Lord Mackie of Benshie

My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government why British pensioners who have paid their full contribution during their lifetime but are now living abroad do not receive the increases in the pension and why the Government allow this to continue.

The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Trefgarne)

My Lords, the general position is that British pensioners abroad receive their pensions at the rate which was in force when they left this country, or, if they were already abroad, at the time when they first qualified. Subsequent increases are payable only where this is provided for either under EEC regulations or under a bilateral agreement on social security between the United Kingdom and another country. To pay increases other than in these cases would cost about £113 million a year, and we have no plans to do so.

Lord Mackie of Benshie

My Lords, I thank the Minister for that Answer, but is the reason not a little unjust? Does he not agree that, if British people have paid the money, they deserve to get the same pension wherever they are living? Surely it is a little unjust for the Government to collect this money, which is what they are doing, simply because these people live abroad?

Lord Trefgarne

My Lords, I understand it has been a long-standing principle that those who seek to leave these shores lose their automatic entitlement to benefit of this kind. However, it is perhaps worth saying that of the 283,000 or so people living abroad who are in receipt of retirement or widows' pensions, 111,000 in fact receive increases of one kind or another under either European Community regulations or reciprocal agreements.

Lord Davies of Leek

My Lords, is the noble Lord aware that, whatever may be the number overseas and whether or not they were already overseas, that £113 million (if I caught his Answer correctly) would have been estimated actuarially over the years as if they existed in this country? Consequently, why penalise those grandparents who go overseas to live with their sons and daughters who may have emigrated?

Lord Trefgarne

My Lords, the £113 million is an annual figure which would have been arrived at by, I think, a somewhat complicated calculation, no doubt including actuarial considerations which the noble Lord described. But, as I say, the general principle always has been that once people leave these shores they lose their automatic entitlement to these benefits

Lord Boyd-Carpenter

My Lords, is it not the fact that, in any event, these pensioners receive by way of pension a greater value than that for which they contributed? Is it not also the fact that by residing abroad they are depriving themselves of the privilege of contributing to United Kingdom taxation?

Lord Trefgarne

My Lords, the latter point is of course a very important one. These are very often people who have for quite proper reasons chosen to live abroad, and therefore are not within the compass of the Inland Revenue. But I think the other point that my noble friend made is right.

Lord Wells-Pestell

My Lords, may I ask the Minister whether it is not a fact that the increases given to pensioners in this country are given to meet inflation, and that many of the pensioners abroad are probably living in countries where the level of inflation is less?

Lord Trefgarne

My Lords, I imagine it is a swings and roundabouts situation, to be fair. I think that, although there are some countries with a lower rate of inflation than ours, there are also some with a higher rate.

Lord Mackie of Benshie

My Lords, may I point out that my Question did not refer to rich tax exiles but in fact to a number of people living in India and doing good works there. In no way are they depriving this country of any tax; they are in fact living in need of the increases which they do not get.

Lord Trefgarne

My Lords, I was not aware of the precise group of people to which the noble Lord's Question related, but I take note of what he says.

Lord Wallace of Coslany

My Lords, is the noble Lord aware that while we regret the passing of the bedside manner of the noble Lord, Lord Elton, we welcome the noble Lord back home?

Lord Airedale

My Lords, was it not also a part of the bargain with these lifetime contributors that their estates would receive a death grant, and is there now a danger that in some cases this bargain is not going to be honoured?

Lord Trefgarne

To be truthful, my Lords, I am not aware of the answer to the noble Lord's supplementary question. Perhaps I can look into the matter and write to him.