Losing your pension after Brexit

[Doodle]

Yikes, I've just read about this on another forum and within that discussion someone is saying that we will no longer be able to receive our company pensions in our UK bank accounts because we live in the EU! I do hope they have got this one wrong.

https://www.bloomberg.com/news/articles/2018-05-10/britain-s-retired-sun-seekers-risk-losing-pensions-after-brexit

Mrs KG

[YCCMB]

From your link:

"With less than a year before the official exit date, the two sides haven’t even started discussing the issue of cross-border financial services, leaving pensioners like Barlow unsure about the future."

And:

"As far as EU pensioners living in Britain are concerned, the U.K. government has promised to allow insurers from the bloc to continue servicing insurance policies after Brexit, meaning people in the U.K. with pensions from European providers can still receive payments, according to a Treasury committee spokesman. The EU hasn’t reciprocated."

Looks like, on this occasion, UK pensioners need to think about lobbying the EU.

[Mac]

I believe this is more to do with private (as in totally private pensions backed by insurance companies) rather than company pension schemes. At least that's what was said on a Facebook (members only) site.

[andyh4]

But where is the distinction?

Once you have bought an annuity, you are with an insurance company, just as with a private pension.

Those who might be safe are those (diminishing number) who have defined benefits, but if you have defined contributions then I suspect if this is not sorted it will become a right mess.

[Mac]

But with most company pension schemes you don't buy anything as your pension fund is run by trustees.

[andyh4]

I can only speak from my one experience in the UK Mac.

In the mid 90s it tried to persuade employees to switch from a defined benefits to defined contributions scheme. Some changed, others stayed with the defined benefits scheme. [In hindsight this was probably set up to forestall a shortfall in the fund.]

So with two systems running we could see how the differences worked.

Employee and company contributions went into the fund and this was indeed managed by the trustees - irrespective of which scheme.

On retirement differences kicked in. For those on defined benefits, their pension pot stayed under the control of the trustees. For those on defined contributions they were given options of annuities with different insurance companies and with different levels of benefit and the money was transferred from the fund to the chosen annuity.

Maybe that's not how it works elsewhere but that is how it worked for the company I was working for.

[parsnips]

Hi,

     I have to say I think, that for existing pensioners,  these fears may be overdone .  I think that any failure to agree "pasporting" would prevent insurance companies etc. from seeking new business in europe.  In the worse case,  I can see no way that pensioners could not pay their pensions into a UK bank account and then use " transferwise" ," xe.com", etc. to transfer to a european bank.

   Maybe a banking expert on here can put me right.

[Patf]

"I can see no way that pensioners could not pay their pensions into a UK

bank account and then use " transferwise" ," xe.com", etc. to transfer

to a european bank. "

That's what I've been thinking, Parsnips, and what we did.

Except that if you don't keep a UK bank account when you move to France, I think I've heard that some UK banks would NOT let you open one after you've become french resident.

[Doodle]

We kept one UK bank account fortunately closing down everything in hindsight not a good idea as when the OH was about to receive a company pension we decided to open another account for this pension to be deposited in. We tried several banks/building societies only to be turned down because they couldn't get a credit score on us as we only have a UK debit card.

Mrs KG

[cajal]

[quote user="Mrs KG"]. We tried several banks/building societies only to be turned down because they couldn't get a credit score on us as we only have a UK debit card.

Mrs KG[/quote]

Not anymore.

From:

DIRECTIVE 2014/92/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 23 July 2014 on the comparability of fees related to payment accounts, payment

account switching and access to payment accounts with basic features.

Member

States should guarantee that consumers who intend to open a payment

account are not discriminated against on the basis of their nationality

or place of residence. While it is important for credit institutions to

ensure that their customers are not using the financial system for

illegal purposes such as fraud, money laundering or terrorism financing,

they should not impose barriers to consumers who want to benefit from

the advantages of the internal market by opening and using payment

accounts on a cross-border basis. Therefore, the provisions of Directive

2005/60/EC of the European Parliament and of the Council (9) should not be used as a pretext for rejecting commercially less attractive consumers.

Consumers who are legally resident in the Union should not be discriminated against by reason of their nationality or place of residence, or on any other ground referred to in Article 21 of the Charter of Fundamental Rights of the European Union (the ‘Charter’) when applying for, or accessing, a payment account within the Union. Furthermore, access to payment accounts with basic features should be ensured by Member States irrespective of the consumers’ financial circumstances, such as their employment status, level of income, credit history or personal bankruptcy.

[Doodle]

Hi Cajal,

It was based on the said directive that I believed that I would be able to open an account in the UK. In March 2017 one of the providers I applied to was The Post Office and was refused due to no credit score and so I wrote to the BBA. The reply contained the following:

The fact you can't be credit checked should not afffect the opening of an account in the UK but no one can force a bank to give you an account.

So where do you go with a reply like that - I gave up trying as I was fed up with the amount I'd spent on postage to no avail plus all the copying of relevant doc as required.

[Patf]

I've just edited my post of this am to "would NOT let you open an account".

[cajal]

[quote user="Mrs KG"] ...........but no one can force a bank to give you an account.

So where do you go with a reply like that............ -.[/quote]

It looks as though, again, the banks have you by the short and curlys.

However, it would appear that currency exchange organisations are moving into borderless accounts as well as money transfers which may be of use to you. Transferwise Borderless Account

[parsnips]

Hi,

      I have seen on other forums posts listing the UK banks which will open accounts for expats. Anyone needed to open one should be able to find one with some research.