British pensioners abroad, including Thailand, will soon lose UK banking confidentiality if suspected of cheating on their state pension. The Data Protection and Digital Information Bill, presently at committee stage in the House of Lords, is expected to come into force early in 2025. It requires British banks and building societies to share with the Department for Work and Pensions (DWP) the accounts of British citizens, both at home or abroad, where fraud looks likely.
The main abuse amongst a small minority of British expats is hiding the fact that they live in countries not eligible to receive annual increases in the state pension. The rules are idiosyncratic as such inflation-linked raises are permitted in some countries (e.g. the EU and the Philippines) but not in others (e.g. Thailand and Australia). Around 500,000 British pensioners live abroad with “frozen” state pensions and the DWP believes that overpayment amounts to 100 million pounds.
Miscreants usually keep a UK address for postal contact with DWP even though they are spending all or much of their time abroad. One Thai-based Brit was found out last year when a DWP letter sent to his London address was returned by a neighbour with the comment “Lucky Sod Lives in Pattaya”. Another was exposed after his UK wife found out he was enjoying himself in Bangkok rather than working in Baghdad as she had been mischievously told. The new act will likely show up in computerized data those state pension claimants receiving annual increases who appear (from their bank accounts) to be based in foreign lands.
However, the Thailand-based pressure group to end frozen UK pensions pointed out that cheating is a very minor problem. The bigger issues, according to a spokesman, are DWP mistakes in processing claims and the nonsense of discrimination according to which country you happen to live in. Neither the previous Conservative government, nor the incumbent Labour one, has shown any interest in remedying the problem.
Another issue of concern to many expats in Thailand is the unreliable international postal system. Every three years, the UK authorities demand a certificate of life (proof you are still alive) to continue payments, but the letters are dispatched by ordinary air mail via an agency in Holland. Many letters are never delivered, leading to suspension of payment when no reply is received. “The whole system is insane and discriminatory,” said Pattaya-based Frank Weston who is 68. He suggested that the paper trail should end and be transferred to a digital system.
