The cost of uprating the state pension in frozen rate countries could be £860m in 2023/24, Department for Work and Pensions (DWP) statistics have revealed.
UK state pensions for overseas residents are increased in-line with the annual index-linked increases where there is a legal requirement to do so.
As of March 2022, there were approximately 480,000 recipients of the UK state pension living overseas who do not get pension increases with 84% residing in Australia, Canada and New Zealand.
However, figures from the Department for Work and Pensions showed that uprating the state pension in frozen rate countries could cost £4.59bn ($5.89bn, €5.33bn) between 2023/24 and 2027/28.
Estimated cost of uprating state pension
|Total (2023/24- 2027/28)||£4.59bn|
The estimates are based on the latest available data from the 5% extract of DQP’s State Pension administrative data, the Quarterly Statistical Enquiry (QSE).