asked Her Majesty's Government:

Further to the Written Answer by Lord McKenzie of Luton on 1 April (WA 145), when the uprating arrangements for United Kingdom state pensions paid to recipients in Overseas Territories were last reviewed; what the outcome of the review was; and what the cost would be of uprating United Kingdom state pensions to recipients in Overseas Territories. [HL3018]

All the department's policies are kept under review. The UK state pension is uprated for UK pensioners living overseas where there is a reciprocal social security agreement or a legal requirement to do so. The provisions on the non-uprating of UK state pensions for some pensioners living abroad have been the subject of litigation in the domestic courts, all of which found in favour of the Government. The issue is now the subject of an application for a hearing to the European Court of Human Rights.

The cost of up rating the UK state pension for recipients residing in the British Overseas Territories where state pension is frozen would be just under £500,000¹ for 2008-09 on the assumption that the frozen pension is brought up to the current value and then up rated. The current estimate is that it would cost around £440 million to bring all frozen rate pensions up to the current rate and this would be an ongoing cost increasing year on year.

We have no plans to change the arrangements to uprate state pension for recipients residing in the British Overseas Territories.

¹ Source: March 2007 Retirement Pension and Widows Benefit administrative data, 5 per cent sample.