With continued
debate on the possibility of the UK withdrawing from the EU (known as
brexit) here are a few thoughts on the ramifications on the effect of
expat state pensioners and their dependents living in the EU... and
how the UK could be "biting it's nose off to spite it's face".
The big
UKIP-driven debate about immigrants "coming over here, stealing
our jobs and taking our benefits" (a juxtaposition if ever I
heard one!) is certainly causing the Tory element of the coalition to
panic like a herd of gazelle into an abyss... and at no point has
anyone at the top of government paid consideration to the 2+ million
British expats residing in other EU countries.
So instead of
worrying about "Johnny Foreigner" let's take a reasoned
look at the effects of a brexit on your granddads and grannies... who
may well be looking to take up resident in your spare bedroom after
2017!
Currently, expat
British state pensioners and their dependents are entitled to receive
their state pension (NOT a welfare benefit1) and
"exportable" benefits if they have a sufficient link to the
UK. The DWP do not actually provide their calculations for the
sufficient link eligibility, but those that have the right to receive
a state pension due to reaching the qualifying years of national
insurance payments (nowadays only a mere 30 qualifying years) are
generally deemed eligible... a seemingly one-sided criteria given
that the children of migrants living outside the UK are currently
entitled to receive Child Benefit, but I will not go down the route
of that argument here.
The main
exportable benefits received by OAP British expats in the EU are DLA
(care component only, not mobility2) or Attendance
Allowance and Carers Allowance.
Before any critics
jump on this bandwagon and correct me on this, I know that there are
limited additional benefits that can be claimed by work-age expats,
i.e. JSA for the first 6 months you are abroad and seeking work, but
this article is dealing specifically with OAPs who have been living
in the EU for several years and their dependents who will no longer
be eligible for any short-term UK benefits.
As has been widely
reported, Winter Fuel Payments for OAP expats are being removed in
2015 (legislation due to conveniently occur just BEFORE the General
Election) from a selection of EU countries3, based on
annual average temperatures. However, it should be noted,
particularly by those UKIP supporters gleefully clapping their hands
at this news in the UK, that due to the manipulation of temperature
statistics by the DWP, while OAP expats in "hot" France
will lose their WFP, the Tories have ensured – for reasons known
only to IDS – that those in "cold" Italy will retain the
payment!
And, as an aside,
for anyone interested in the workings of the EU and “benefits”,
the European Commission has decreed that WFP is part of an OAP's
state pension and, as such, it is illegal to remove this element from
being paid. Needless to say, if the Tories regain power and this
legislation remains in place, and the UK population vote to stay IN
the EU, then this will be subject to a legal challenge that will be
dragged for years through the European Court of Justice, at a
substantial cost to the taxpayer that will probably outweigh the cost
of actually paying it.
To give an idea of
how the UK government likes to decry the ECJ and then use it for its
own twisted means against its disabled citizens, for example, just
Google ECJ cases C-299/05 and C-537/09. The latter is a wonderful
wake-up call for those who think Cameron's crocodile tears for his
son are real. He really does not give a flying f*ck about the
disabled.
Anyway, let's move
on to healthcare and the NHS – a big talking point at the time of
writing this blog, as Gideon has announced a £2bn boost to the
ailing UK service. Unlike the UK, most other EU countries do not
provide services "free at the point of delivery", so along
with the indigenous populations, even UK state pensioners are obliged
to have some form of private insurance as the reciprocal agreements
within the EU do not cover 100% of the costs.
For example, in
France, payments for GP and specialist visits are made upfront: €23
for a GP visit, €44 (average) for a specialist. Hospital stays will
be invoiced for payment by cheque/card or be covered by insurance.
Prescription charges must also be covered otherwise payment is
required.
Thinking about
this, it might make those living in Britain a bit more mindful about
making appointments that they then fail to attend if the UK adopted
this policy. But given that the UK does not even charge other EU
migrants to access NHS services, could this be seen as another failed
opportunity that has been perpetuated by consecutive UK governments?
OK, Cameron &
Co are now talking the talk about ensuring NHS charges are made by
“foreigners” and that benefit entitlements are tightened up, but
this smacks of closing the gate after the horse has bolted...
particularly as the benefit changes being proposed are already de
rigour in some EU countries in that you do not get anything out of
the system without first paying a hefty amount in!
Anyway, in the
event of Britain leaving the EU and repatriating "foreigners",
there is no reason why the British expat's host country cannot do the
same. Even if there is no tit-for-tat reprisals, there is no doubt in
the current climate, that the UK government will seek to punish
expats who remain abroad by freezing state pensions, as they do
already for those in Canada, Australia etc, and removing their rights
to exportable benefits, which are currently protected under EU law.
If this is the
case, then many of those living on a basic state pension will find
themselves forced to return to the UK, so let's have a look at what
could entail:
Firstly, it should
be noted that back in the days of the Colonial Empire – those days
currently being sought to be relived by our UKIP pals – the British
expatriate was, no doubt, a moneyed individual with no reliance on
state assistance. The stereotypical expat, foisted upon a naïve UK
population by the likes of the Daily Mail and Daily Express, is one
who sits around a pool all day, in brilliant sunshine, quaffing
champagne. Sadly, my friends, those expats are a rare breed and for
those dinosaurs that still exist, they most certainly will not be
worrying about what is going on back in the homeland.
Instead many of
the expat communities, those living particularly in Spain, France and
Portugal, are of the post-war (baby boomer) generation of hard
grafters who had the opportunity to buy their council properties in
the UK while working. Then, when it was time to put their feet up,
having paid into the NI system for a minimum of 44 years to get their
pittance of a State Pension (and for those fortunate enough, a small
public or private pension), took the chance to cash in the fruits of
their labour and buy a retirement flat, finca or derelict farmhouse
in foreign climes.
Following the
global crash and like many ordinary folk in Blighty, many of these
expats have seen their retirement abodes become worthless and their
state pension reduce by a weakened pound (and in my opinion an
artificially inflated euro!). Belt-tightening has been the order of
the day, just like everyone else.
At this point, I
also need to point out – having been confronted on the issue of
expats being able to sell up and bring their “fortune” back home
to Blighty and invest in the housing market there – that some
expats left rented property in the UK to rent in their host country,
and therefore have no “assets” to sell up in the event of a
return... so one can only hope that the UK government has the
necessary resources in place to house these OAPs, particularly if
adapted properties are needed!
Either way, as I
write this, it would appear that a return to the UK is seeming more
attractive. After all, OAP expats would find themselves entitled to
receive the following, thank you very much:
State Pension
Pension Credit
Winter Fuel
Payment
Cold Weather
Payments
Housing Benefit
Council Tax
reduction
DLA Care &
Mobility components
Attendance
Allowance
Carers Allowance
Free NHS
healthcare
Free prescriptions
While any work-age dependents may be able to additionally claim:
JSA
Income support
Incapacity
benefit/ESA
Mmm... now this is
increasingly becoming very interesting isn't it?
Maybe this brexit
thing won't be too bad, eh, for us old muppets if we troop back to
Blighty?
All those extra
benefits that we currently waiver in favour of our expat “lifestyle”,
which in many cases is nothing different from the “lifestyle”
we'd be living back home.
Makes you think,
doesn't it? Grass, greener, other side of the fence... and such.
Oh, but wait? If
the UK throws out the working EU migrants who are currently paying
into the system that allows continued payments of State Pension to us
and, hopefully, the generations coming along behind, where exactly
does that leave us all?
Time to step back
from the brexit precipice and reflect, maybe?
1. State Pension:
it is a grotesque effrontery to common-sense that IDS and Gideon have
bundled the State Pension into the benefit/welfare pot, as those in
receipt of SP have earned the right to receive this money after years
of national insurance contributions.
2. DLA Mobility
component: it should be noted that if anyone living in the UK with
restricted mobility, or even wheelchair-bound, is thinking of moving
to another EU country, that following a long drawn out legal case
through the European Court of Justice using taxpayers money, the UK
Government (Labour and then the current coalition) decreed that DLA
Mobility is NOT an exportable benefit (ECJ case C-537/09). So
presumably you can arise like Lazarus and throw away your mobility
aids the minute you leave Blighty's shores!
3.
Winter fuel payments will no longer be available to OAP expats living
in: Cyprus, France, Gibraltar, Greece, Malta, Portugal and Spain.
Note that Italy is not excluded and expats there will continue to
receive WFP. To ensure that expats in France have their WFP removed
from 2015, IDS and the DWP included France's 5 overseas tropical
departments in the provided dataset – Guadeloupe, Martinique,
Mayotte, Réunion, and French Guiana – where only 30 retired Brits
live, but this allows denial of WFP to those living in the colder
climes of mainland France where temperatures in the winter fall to
MINUS 15 degrees celcius! If IDS can do it there he can do it in the
UK, so Cornwall, Devon and Dorset beware!