Thousands of state pensioners face double blow after missing out on over £3,000 in payments

British expats are confronting a double financial hit to their state pensions, with those living in "frozen" countries such as Australia, Canada and South Africa missing out on more than £3,000 in pension increases since 2023.

A petition calling on the Government to scrap the frozen pension policy has gathered more than 7,300 signatures, although less than a week remains before the deadline to secure enough support for a parliamentary debate.

Managing Director Tim Grimsditch said: "Over the last three years, the New State Pension has increased by £37.45 per week - that's roughly £162 extra a month."

Research suggests pensioners affected by frozen rates have missed out on a combined £3,237 in increases, as their payments stay fixed at the amount they were receiving when they moved overseas.

The situation is set to worsen for some expats after changes announced in last year’s Autumn Budget.

From April, people living abroad will no longer be able to use Class 2 voluntary National Insurance contributions, which has traditionally been the cheapest way to protect their National Insurance record and build up entitlement to the UK state pension.

Instead, overseas Britons will have to pay Class 3 contributions, which are considerably more expensive each year.

Nigel Green, CEO of DeVere Group, said: "A significant number of British expats are at risk of being shut out of cost-effective ways to secure their state pension.

"Over time, switching from Class 2 to Class 3 [NI contributions] can add thousands of pounds to the cost of securing a full or partial state pension, fundamentally altering long-term retirement planning calculations."

Beyond the cost increase, a new eligibility threshold will bar individuals from making any voluntary payments unless they have accumulated at least 10 years of UK contributions or residency.

This restriction threatens to lock out internationally mobile professionals, those who departed Britain early in their careers, and long-term expats from addressing gaps in their contribution records.

The consequences for future pension entitlement could be significant, as the UK state pension system demands 35 qualifying years for full payments.

A minimum of 10 years is required to receive any pension whatsoever, with each missing year reducing the final amount paid out to retirees.

Mr Green warned that expats must act swiftly, stating: "Eligibility is tightening at the same time as costs are rising.

"Anyone who has worked in the UK needs to assess their position now, because the options available today will not necessarily exist after April."

Mr Grimsditch echoed concerns about over-reliance on state provision, noting that many affected retirees spent their entire working lives in Britain before relocating abroad for retirement.

He said: "This is a reminder that you can't always rely on the State Pension when you retire, especially if you're thinking of moving abroad.

"Planning now is usually the best way to ensure you can live comfortably, no matter where you end up."