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432-00504 (Foreign affairs)

Paper petition

Original language of petition: English

Petition to the Government of Canada

WHEREAS

  • Worldwide there are nearly half a million pensioners in receipt of a UK state pension which is "frozen" at the same amount as when the pension is first received - i.e. these pensioners never receive an annual cost of living increase to their UK state pension once payments begin. The UK is the only OECD country in the world to discriminate based on country of residence when it comes to providing annual inflationary increases to pension payments.
  • 91% of these pensioners live in four Commonwealth countries - Australia with 228,000, Canada with 128,000, New Zealand with 65,000 and South Africa with 32,000.
  • The UK Government has estimated that to uprate these “frozen” pensions worldwide would cost $1bn a year. Canada's share of this is $269 million. This has a “spending power” in excess of half a billion dollars a year, which would boost the Canadian economy significantly.
  • UK Governments have consistently said that they will only uprate “frozen” pensions through bilateral agreements. However, in 2013, UK Freedom of Information request 2013/00595 confirmed bilateral agreements were not required in order to uprate “frozen” pensions.
  • Any increase to the UK state pension would be taxable income in the hands of the UK pensioners living in Canada. In addition, since pensioners tend to be spenders rather than savers, then the Canadian federal and provincial governments would also receive a boost via GST and, in most cases, PST.
  • Any increase received by these pensioners living in Canada could mean that they are no longer eligible for GIS and social assistance, and this would represent a saving to the Canadian governments.
  • According to Statistics Canada, as at 2016, there were 828,000 pensioners living in Canada aged 65 and over on "low income", and, according to the Government of Canada, 10.3% of men and 10.8% of women aged 65 and over were living below the poverty line.

We, the undersigned Canadian citizens/Permanent Residents of Canada call upon the Prime Minister to:

  • Raise the issue of Frozen British Pensions at the upcoming Commonwealth Heads of Government Meeting (CHOGM) in Kigali, Rwanda - June 22-27, 2020;
  • Ensure that any future trade expansion discussions with the UK are dependent on the UK Government first unfreezing the UK state pension payments worldwide.

Response by the Minister of Seniors

Signed by (Minister or Parliamentary Secretary): The Honourable Deb Schulte

Under UK law, UK State Pensions are paid anywhere in the world. However, for many UK pensioners living in countries outside the UK, including in Canada, their pensions are not adjusted annually for increases in the cost of living. In other words, their pensions are "frozen" and paid at the same rate as they were when they first became entitled, or the date they left the UK if they were already pensioners then. This ultimately erodes the value of these pensions over time.

Canada's long-standing position is that UK pensioners who live in Canada have contributed to the UK pension scheme, and have therefore earned the right to be treated the same way as other UK pensioners.

Over the years, the Government of Canada has raised, and has sought to address, this issue with the UK, including by proposing that the two countries negotiate a comprehensive social security agreement that would provide for the indexation of UK pensions. To date, UK officials have not engaged on this issue.

In early 2020, the British Secretariat of the All-Party Parliamentary Group (APPG) on Frozen British Pensions launched an inquiry regarding the impact of the UK Government’s approach to UK State Pensions paid to UK pensioners living abroad.

The final report of the APPG was released in December 2020. The Government of Canada presented a submission on UK pensioners living in Canada, for the APPG’s consideration. The submission is consistent with its long-standing position of support for UK pensioners regarding the non-indexation of UK pensions. This submission was approved by the Minister of Seniors in September 2020. 

Minister of Seniors, spoke with the United Kingdom’s APPG on Frozen British Pensions about this issue on February 23, 2021, and reiterated Canada’s position.

The Government of Canada will continue to raise this issue with the UK through various channels, where appropriate. Canada remains prepared to engage with UK officials should they choose to reconsider their non-indexation policy. 

Response by the Minister of Small Business, Export Promotion and International Trade

Signed by (Minister or Parliamentary Secretary): Rachel Bendayan

The Government of Canada understands that the United Kingdom’s (UK) non-indexation policy is of great concern to many UK pensioners residing in Canada. It is important to note that the UK policy of non-indexation stems entirely from its domestic law. A trade agreement is not the appropriate mechanism for advancing the issue of pension indexation by the British government.

The Government of Canada will, however, continue to raise the issue of non-indexation of UK pensions directly with the UK. We have also made submissions to the All-Party Parliamentary Group on frozen British pensions, which was released December 16, 2020. Canada’s longstanding position has been one of a support for British pensioners regarding the non-indexation of UK pensions.

Presented to the House of Commons
Tracy Gray (Kelowna—Lake Country)
February 16, 2021 (Petition No. 432-00504)
Government response tabled
April 12, 2021
Photo - Tracy Gray
Kelowna—Lake Country
Conservative Caucus
British Columbia

Only validated signatures are counted towards the total number of signatures.