Court hearing expat pensions case

South Africa resident Annette Carson is one of those bringing the case

A case that could affect the pensions of 520,000 Britons who have retired abroad is being heard in the European Court of Human Rights.

A group of 13 pensioners who have moved abroad want their UK state pensions to rise in line with inflation each year.

Inflation-proofing only applies to UK pensioners who live in the European Economic Area or in 15 other countries, but not some Commonwealth states.

The expat pensioners say they have been unfairly discriminated against.

"It is the last chance we've got," said Charles Poole, President of the South African Alliance of British Pensioners (SAABP).

Long running saga

This is the latest stage in a long-running legal challenge and the eventual decision will be the end of the line in the legal process.

The two-hour hearing is taking place in the Strasbourg court on Wednesday, but judgement in the case will not be made until March or April 2010.

Andrew Harrop, head of Public Policy for Age Concern and Help the Aged, said: "It's hugely unfair that pensioners who have made their national insurance contributions all their lives in the UK are being penalised for retiring abroad and losing out on the uprating of their pension."

"We hope the case today will see an end to this inequality and ensure the government gives every pensioner their fair share, no matter where they decide to retire," Mr Harrop said.

The UK Department of Work and Pensions argues that the government's priority is to help the least well-off pensioners living in the UK.

Frozen state pension

One of those whose case is being outlined during the hearing is Annette Carson, who emigrated to work South Africa in 1989 and later retired there.

The discrimination against us is not based on any degree of logic Charles Poole, SAABP

After emigrating, she continued to make full contributions to her UK state pension and, on retirement in 2000, began to receive pension payments.

But since then, the UK authorities have frozen the level of payments at £67.50 a week.

She took her case through the UK court system, including to the House of Lords, where it was rejected.

She and the other campaigners from countries such as Canada and Australia claim that the UK's rules unfairly discriminate against them, and nearly half a million other expatriate UK pensioners, in breach of the European Convention on Human Rights.

"We have to remain optimistic," said Mr Poole.

"We still are confident the human rights legislation is fair and that we have a fair and strong case.

"The discrimination against us is not based on any degree of logic," he added.

Annual upratings of the UK state pension are paid to recipients living in the European Economic Area and Switzerland, as well as countries where there are reciprocal social security agreements such as the US, Jersey, Guernsey and Turkey.

Countries where pension payments to expats are frozen include Australia, Canada, South Africa and Hong Kong.