§ Mr. Letwin
To ask the Secretary of State for Social Security what policy she will adopt on the payment of annual increments to United Kingdom pensioners living overseas. 242W
§ Mr. Denham
The Government have no plans at present to change the policy that state retirement pensions are uprated only within the European Economic Area and in certain countries with which the United Kingdom has a social security agreement which provides for uprating.
It would cost some £255 million per year fully to unfreeze those pensions which are not uprated—that is, to bring them up to the rate which would be paid if the pensioners were in the UK. There are competing demands and constraints on social security spending, and it would be wrong to raise expectations that uprating these pensions would be likely to attract priority in current circumstances.