Pages tagged with "Pensions"

The Wheels are off the UK Bus

Guy Stenhouse, writing in one of the Herald's regular, 'talking Scotland down' columns, that they gift to unionist campaigners, appears to have only a passing acquaintance with movies or the facts. He uses the analogy about wheels coming off the nationalist bus just as they did in the movie the 'Italian Job' - I can categorically tell you that the bus in the aforesaid movie didn't lose any wheels nor has the Yes movement. However, let’s humour him with his wheels off the bus analogy and point out where he is wrong.

Wheel one, pensions. Scotland more than pays its way. Once independent, it will keep all the tax and national insurance revenues, not send them to Westminster, and since life expectancy is lower, Scotland could raise the state pension at no additional cost. But Scotland shouldn’t advertise this since it may precipitate a flood of people coming north to escape one of the lowest basic state pensions in the developed world.

Wheel two, currency. SNP policy is to adopt a Scottish currency as soon as practicable after independence. Currency has no intrinsic value but derives value from the goods and services an economy produces. Scotland’s immense natural wealth, highly developed economy and educated and innovative people will guarantee our currency has value. Scotland will launch its own currency at the point it becomes advantageous to Scotland to have one, there will be a transition period and using Sterling (our own currency) for a short period would maintain pensions values and facilitate trade as Scotland becomes independent. A sensible, desirable and pragmatic approach. 

Wheel three, the deficit. Under the terms of the devolution settlement, the Scottish Government must balance its budget every year. London assigns Scotland a deficit based on the supposed benefits we receive from being part of the UK and for billions spent on nuclear weapons, foreign wars, unemployment payments because of UK economic mismanagement, Westminster corruption, servicing a UK debt Scotland didn’t generate, expenditure on Brexit and negotiating foreign treaties that damage Scotland’s economic interests. Some of the UK's spending on Scotland's behalf is spent in Scotland but what deficit Scotland has will change dramatically once we remove the added costs of UK membership and start investing in Scotland's wellbeing.   

Wheel four, the EU, not English, Single Market. ONS figures show the UK’s economic recovery has lagged that of its EU counterparts and UK exports to the EU plummeted by £20 billion in 2021 compared to 2018. As for that vaunted EU rebate, there is no £350m extra per week for the NHS. Regressive National Insurance taxes are rising, the triple lock on pensions is gone, and food and energy prices are soaring. Meanwhile, the newly minted Minister for Brexit Opportunities, Rees-Mogg, is desperately scrabbling around amongst Sun readers for ideas on how to turn this sow’s ear into a silk purse.

Scotland will be back in the Single Market as soon as we exit this failing Union and like Ireland, will rapidly forge new trade links with the EU, leaving behind an isolated rUK that will sorely need Scottish energy, water, and food and drink.  

The wheels have been off the UK bus for some time now. The founding director of the Fraser of Allander Institute, David Simpson, put it well: “The economic cost to Scotland of our dependency on England is measured by the incomes, jobs and tax revenues that have been foregone as a result of the slower rate of growth of the economy because of its mismanagement under the Union.”

Once independent, Scotland will be able to make economic, social and foreign policy decisions that will benefit the people of Scotland.

Daily Mail Fail: Paper published pensions story it now claims is false

The Daily Mail yesterday ran an article criticising Believe in Scotland as having made a false claim about pensions which Believe in Scotland then thoroughly debunked. We have now discovered that the Daily Mail previously published the same claim about the UK state pension being the worst in the developed world. We, (only half-jokingly) wonder if the paper should now report itself to the Independent Press Standards Organisation (IPSO) admitting that it must have either misled its readers in 2018 or is misleading them now?

So why is the paper in such a muddle now, contradicting itself and creating an embarrassing Scottish Daily Mail Fail? 

First of all, they sourced their story from Twitter trolling by a biased unionist campaigner who lacked the expertise to understand the issue or simply wished to convince The Mail to mislead its readers, then the paper itself didn't check the facts - nor did it realise that its own UK Policy Editor previously broke the news about UK pensions being the worst in the developed world in the national edition of the paper.

Taking action

BiS Chief Executive Gordon MacIntyre-Kemp has written to the editor asking for a retraction and a right to reply which would be given the same amount of space in the paper and online as the original misleading story. There are four reasons that we have demanded the right to reply. 

  1. The story is incorrect, as we have proven already the statement that the UK pays the worst state pension in the developed world is a factual statement. We provided the evidence that the claim was factual prior to the article being published (quotes from the same email were used) thus proving that the paper was aware the story was false. 
  2. The Daily Mail itself ran the same story claiming the "UK had the worst state pension in the developed world" and the same headline in 2018 when the research was first published by the OECD. Thus, the paper is either misleading its readers now or was misleading them in 2018.
  3. The article headline states that Believe in Scotland claimed that the UK state pension was the 'worst in the world' we never have, we have always stated that the "UK Pension is the worst in the developed world". The former is untrue the latter is a fact, we have always used the factual statement. 
  4. For the Daily Mail to go ahead and publish a story that was based on unsubstantiated Twitter trolling based on misrepresentations of Believe in Scotland's actions is both biased and unprofessional. 

We await the Daily Mail's response to our request for a retraction and an equal right to reply.

The facts are not even disputed.

Links to other media outlets that claimed that the UK has on of the worst pensions in the developed world".

The Guardian - "UK has lowest state pension of any developed country" 

Daily Mail's incoherent attack on Believe in Scotland is a dishonest muddled misfire

The Daily Mail today tried to have a go at Believe in Scotland's campaign to end pensioner poverty, but their incredibly muddled attack produced a factually incorrect headline and an article that is incoherent and contradictory.

Let’s be clear, they tried to write an article about Believe in Scotland, but we supplied them with the facts about pensions and they then tried to tie us into an earlier attack on the SNP. First, let’s deal with the claim about Believe in Scotland in the factually incorrect headline which states, “Nationalist Group ‘systematically deceiving OAPs’ after falsely claiming UK “worst in world”.  

The problem with the headline is that the UK pension is the worst in the developed world, and that is what we have correctly claimed. So, we will be writing to the Editor and demanding the paper prints a retraction or allows us the right to reply. 

The Facts

According to the OECD research that we based our claims on, the UK pays the worst basic state pension in the developed world, worth just 28.4% of average income at retirement (based on the net replacement rate). Furthermore, The House of Commons Library confirmed the 28.4% and further revealed that the UK state pension falls significantly below the OECD average of 58.6% but also the EU average of 63.5%.

So, to claim that the basic state pension is the worst in the developed world is wholly accurate. The Daily Mail headline seems to be based on claims that if you include wealthy people’s voluntary pensions contributions then people are better off - but that has nothing to do with the fact that the UK basic state pension is woeful and degrading to those who can't afford voluntary work and private pensions.  

When voluntary pension provision is included, the UK’s net replacement rate rises to 61% compared to the higher 67% EU average but the UK Governments basic state pension still sits at 28.4%. In other words, as many people can’t afford private pensions or to stay opted into voluntary employee pensions, the 28.4% figure is shameful and cannot be ignored.

People who retired before the New State Pension (2019) and the opt-out company contribution scheme came into force or those that were not paid enough and had to opt-out of voluntary pension schemes receive far less than the EU average. The lower replacement rate of the state pension penalises people who have experienced long periods of unemployment, carers (mostly females from less affluent households), women who take career breaks to raise children, people with disabilities or long-term illness and the working poor, all of whom have been let down by successive Westminster Governments.

So, the Daily Mail article (which was triggered by Unionist groups social media trolling) seems to be suggesting that we don’t need to pay enough for pensioners on the basic state pension to live with dignity as wealthy people are not affected - that is a truly disgusting attitude.

Even more of a muddle  

The second part of the article, which is even more muddled, suggests our campaign to raise the basic state pension is SNP propaganda. But our policy of a £210.00 pension is not supported by the SNP and our campaign is clearly partially aimed at persuading the SNP to agree with us. If we were an SNP front, then disagreeing so publicly with the SNP might not be such a priority for us. Also, the SNP are attacked in the article for saying “The UK owes people a pension and will keep paying people pensions after independence”. Let’s be clear, the UK does owe people a pension (if they have made their NIC contributions). However, we believe that an independent Scotland should a) Take on full responsibility for payment of pensions and b) Inform the UK Government that we will subtract the cost of this pensions from any debt settlement (matched to asset settlements) agreed during the independence settlement negotiations that will follow a Yes vote in 2023. So, we are totally at odds with the SNP on pensions and we try to influence them, not the other way around.

They also say that Believe in Scotland is “closely linked to Business for Scotland… the economic think tank set up before the 2014 referendum”. However, we emailed them and explained ahead of the article being written that “Business for Scotland Ltd is a business networking and campaigning organisation that supports independence and champions the Wellbeing approach to economics. It operates completely independently from any political party. Believe in Scotland is the name of one of our campaigns.” How hard would it have been to get that right?

They did carry a quote from our Chief Executive - the only part of the article that makes sense - he said:

Believe in Scotland are campaigning to end the UK’s degrading pensioner poverty in an independent Scotland by paying a Real Living Pension (currently £210.00 per week), then raising the state pension to match the EU average as the economy grows over time with the powers of independence.  

For unionist campaigners to claim that the 28.4% figure is irrelevant because it doesn't apply to the wealthy, simply shows how out of touch they are with the needs of pensioners. Gordon MacIntyre-Kemp, Chief Executive of Business for Scotland.


The plethora of childish complaints about our campaigns (in papers such as The Daily Mail and The Times) all originate from trolling by the many fake-grassroots unionist front organisations and represents a desperate attempt to deflect from the investigations into their dark money funding and potentially illegal campaigning. 

If they were anything other than smoke and mirrors operations for Westminster's economic and moral failures, they would spend their time pressuring the UK Government to match our call for a £210.00 a week basic state pension to allow our old folk to live with dignity but that is just clearly not on the Unionist agenda.

Revealed: UK's paltry pension can't provide even the most basic standard of living

The UK state pension is not big enough to support the bare minimum standard of living for a single person, according to a new report. And it warns that a quarter of employees are not on track to be able to afford it.

The Retirement Living Standards report published by the Pensions and Lifetime Savings Association estimates that a single pensioner needs £10,900 annual income after tax to support what it defines as the minimum standard of living. That works out at around £209.60 a week. Last month Believe in Scotland had the economic consultancy firm Scotianomics work out the minimum living standard for a Scottish pensioner and we calculate that they would require a pension of at least £200.00 a week.  This new report from PLSA therefore backs up our findings.

The UK’s full basic state pension – the worst in the developed world according to the Organisation for Economic Co-operation and Development – is just £137.60 a week, or £7,155 a year.

The new UK state pension for men born after April 1951 and women born after April 1953 is £179.60, although you might receive less depending on your National Insurance record. The new full pension works out at £9,339 a year, still significantly less than the suggested minimum required but remember most pensionors don't get that much.

Around a quarter of single pensioners cannot afford the bare minimum standard of living

The Retirement Living Standards estimates do not include housing costs as they assume pensioners will have paid off their mortgage.

The report states: ‘About three quarters of single employees are likely to achieve the minimum standard.’ That means around a quarter of new single pensioners will not be able to afford the bare minimum standard of living.

Gordon MacIntyre-Kemp, the director of Believe in Scotland, stated; "This report demonstrates what we have claimed before, that the UK basic state pension does not reach the level at which pensioners who were not able to afford private pensions can live with dignity in retirement. The UK is a wealthy nation and wealthy nations should not have pensioners living in poverty. However successive UK governments have deliberately kept the state pension low to force those than can afford it to purchase private pensions. This boosts the profits of the city of London at the expense of pensioners. This must stop and we will not allow it to be the case in an independent Scotland".

A minimum lifestyle is based on the Joseph Rowntree Foundation’s Minimum Income Standard and covers all a pensioner’s needs and a little extra for ‘social and cultural participation’. It includes a week’s holiday in the UK, eating out about once a month and some affordable leisure activities about twice a week. It does not include a budget to run a car.

The annual budget for the ‘minimum’ standard has risen since 2019 by £700 to £10,900 for a single person and by £1,000 to £16,700 for a couple in 2021. The report suggests only those single employees with workplace pension schemes have even a chance of affording the minimum standard of living.

Only half the number of single employees are on track to expect a lifestyle between minimum and moderate

The ‘moderate’ retirement living standard includes a two-week holiday in Europe and eating out a few times a month. The annual budget for the moderate standard has risen since 2019 by £600 to £20,800 for a single person and by £1,500 to £30,600 for a couple. The eating out budget, which rose from £75 per person per month to £100 per person per month, drove much of the increase for the moderate standard.

Pensions and Lifetime Savings Association analysis suggest only half the number of single employees are on track to expect a lifestyle between minimum and moderate.

The ‘comfortable’ retirement living standard includes luxuries such as regular beauty treatments, theatre trips and three weeks holiday in Europe a year. The annual budget needed for a comfortable retirement living standard has increased since 2019 by £600 to £33,600 for one person and £2,200 to £49,700 for a couple.

Only about one in six single employees are projected to have an income between moderate and comfortable.

Organisation for Economic Co-operation and Development figures in 2018 showed the UK paid out just 29% of average earnings on pensions, the lowest of any developed country. Top of the table were the Netherlands, which pays 100.6% of average earnings, Portugal at 94% and Italy at 93.2%.

Believe in Scotland recently launched a billboard campaign urging a state pension of £200 a week in an independent Scotland.

That campaign was last week attacked by the former Better Together head of strategist in the first independence referendum campaign Blair McDougall. He tweeted: “What I don’t understand is why only promise £200 a week? Why not £300? £1000? If you’re going to bullsh*t at least put your back into it.”

The Believe in Scotland campaign was for a pension slightly lower than the bare minimum now estimated as necessary for a single person by the Pensions and Lifetime Savings Association.

Blair McDougall has been left with a red face for suggesting the UK cannot afford to pay a pension capable of supporting the most basis standard of living for a single person. In fact he thinks that even the suggestion that the UK CAN afford it is laughable.

If that really is the case then the future of the UK is more perilous than we thought and independence offers Scotland’s pensioners the only hope of a decent life.

How small independent countries create a better, more equal society

In some of our previous articles and on our recent Believe in Scotland campaign billboards we have highlighted some of the inadequacies that exist within the UK’s social support system. In particular, one of our billboards drew attention to the fact that the UK offers the worst state pension in the developed world.

In this article, we will consider the social welfare and support systems across some of the small, independent countries in Europe. In particular, we will look at Norway, Denmark and Ireland. This will allow us to analyse and compare the performance and policies of these smaller countries to those of the UK.

This will allow us to present a hypothetical picture of the type of social support that an independent Scotland would be able and likely to offer.

State pension

As we have already shown, the state pension is a gloomy aspect of the UK’s welfare system. So, how much exactly does the UK offer to old age pensioners?

The UK former state pension consisted of two tiers – the basic state pension (£137.60 a week) and an earnings-related additional state pension. The new state pension provides a flat-rate pension worth up to £179.60 a week.

Let’s see how this compares to other countries.

Flat-rate state pensions in countries across Northern Europe: a comparison of full entitlement

Country Basic Pension As a % of UK new state pension
UK (former state pension) £137.60 77%
UK (new state pension) Up to £179.60 100%
Ireland £212.08  




Norway (basic rate)


£162.66 91%
Norway (minimum pension level) £330.38 184%
Denmark (basic rate)  



Denmark (with additional supplement) £366.14  



Small, independent countries offer a much greater state pension than the much larger UK

These figures highlight that small, independent countries offer a much greater state pension (including full entitlement) than the much larger UK. Therefore, it’s more likely that an independent Scotland would follow a similar path as its European neighbours. Indeed, the SNP has said that an independent Scotland would work to increase the Scottish state pension to match the EU average, effectively doubling it.

 Net pension replacement rate

The net pension replacement rate is another interesting way of analysing and comparing the state pension schemes across various countries.

The Organisation for Economic Co-operation and Development (OECD) defines net pension replacement rate as “the individual net pension entitlement divided by net pre-retirement earnings, taking into account personal income taxes and social security contributions paid by workers and pensioners.”

The net pension replacement rate measures how effectively a pension system provides a retirement income to replace earnings as the main source of income before retirement.

Country Net pension replacement rate (% of pre-retirement earnings)












This table demonstrates that the UK’s net pension replacement rate is significantly worse than several of the small independent countries across Europe. In fact, the only country that offers a state pension that constitutes a lower percentage of pre-retirement earnings is South Africa.

Public social spending

 Public social spending is another important factor that should be considered when analysing the effectiveness of a country’s social support system. Public social spending includes health, old age, incapacity-related benefits, family, unemployment and housing, among other things.


Country Public social spending (% of GDP)












These figures highlight that, with the exception of Ireland in this case, Scotland’s Northern European neighbours with a similar population size outperform the UK in terms of public social spending. Indeed, both Norway and Denmark spend a significantly great share of the country’s GDP on public social services than the UK.

 Income distribution

Lastly, this article will consider the distribution of income – another important aspect of ensuring an equal and well-supported society.

The OECD provides an Income Distribution database that monitors the performances of countries in the field of income inequality and poverty. This is measured using the Gini coefficient, which is based on the comparison of cumulative proportions of the population against cumulative proportions of income they receive (ranging from 0, in the case of perfect equality, and 1, in the case of perfect inequality). Therefore, with reference to the OECD’s database, we have compared the case study countries of this article.




Income distribution












This data, again, shows several small independent countries across Europe outperforming the UK. Indeed, Ireland, Norway and Denmark all provide greater income equality than the UK.

By analysing these various social support factors, it has become clear that small, independent countries largely outperform the UK and offer greater security to their citizens


 This article has drawn upon data from various countries across Europe, including the UK, Ireland, Norway and Denmark. By analysing these various social support factors, it has become clear that small, independent countries largely outperform the UK and offer greater security to their citizens. This includes pensions, income distribution and public social spending. Overall, it can be suggested that an independent Scotland would behave similarly to these small European countries and the Scottish Government has already set out various goals for an independent Scotland to prioritise social wellbeing factors and match European targets.

ASA rejects Unionist complaints over independence campaign’s pensions billboards

Believe in Scotland’s current nationwide billboard campaign highlighting the fact that the Westminster government pays the worst pension in the developed world has clearly upset unionist campaigners.

Last week we were contacted by the Advertising Standards Authority (ASA) to inform us that they had received multiple complaints claiming that our statement was not true. Given that it is 100% accurate we were not particularly concerned.  

Our billboards, which feature four designs and have been running on 98 screens across Scotland, do seem to have provoked a concerted complaints campaign, which demonstrates just how two-faced leading unionists activists can be.

It was a disgraceful Better Together campaign tactic in 2014 to tell pensioners that their miserly low UK state pension was at threat from independence when in fact the risk of reduction is now far greater because we remained part of the UK.    

Let's be clear: the UK can afford better pensions and can afford to end pensioner poverty. That is clearly true because every other nation in the developed world is able to do just that. It is simply a fact that the UK government has a policy of keeping state pensions low so that people are forced to pay into private pensions, boosting the pensions fund sector and the City of London. However not everyone CAN afford to do that. The poorer sections of society – those who are disabled, sick and unable to work, who have been made redundant and have experienced unemployment – can’t pay into large private pensions and therefor have to make do with the worst state pension in the developed world (as a percentage of final earnings) just to boost the profits of the City of London.

An independent Scotland will need to raise pensions slowly as the economy starts to grow again after we cast off the economic straitjacket of London-based decision making.  However, the state pension is so bad even doubling it would not be enough to match the EU average.  

We are always willing to defend our claims to the hilt and here is a copy of the evidence we sent to the ASA to back our insistence that the UK government pays the worst state pension in the developed world. 

Our evidence to the ASA


I can confirm that Business for Scotland Ltd (BfS) is the organisation that is running the Believe in Scotland campaign and that I am your point of contact. Please see my contact details in the footer of this email.

BfS is committed to the highest standards in its advertising statements and we completely believe our statements in the pensions advert are true and fair. We also suspect that all of our adverts will be reported to you, not because they are inaccurate but because the complaints will be politically motivated. We are, however, more than happy to work with you to clarify and even change any wordings and aims if you advise that they should be clarified etc.

The statement that the UK pays the lowest state pension in the developed world is based on data provided by the OECD which is essentially the world's largest think tank and one of the most respected sources of economic data.

You can find the comparative data here and on that site you can run other relative comparisons.

Please also see the image below which is the key table used to support our claim.

The net replacement rate is defined as the individual net pension entitlement divided by net pre-retirement earnings, taking into account personal income taxes and social security contributions paid by workers and pensioners. It measures how effectively a pension system provides a retirement income to replace earnings, the main source of income before retirement. The aforementioned definition is from the OECD website. This is the best international comparator for pensions as it relates to final earnings and therefore, the comparative cost of living. This signifies the drop in wealth from earning the pension in each nation.

The countries listed include developing nations and also EU and OECD member nations. South Africa comes out worse than the UK but is considered to be a developing nation and not yet a fully developed country.

The OECD recognises members to be developed and South Africa isn't a full member.

Some points below:

·  The UN has recognised South Africa as a developing economy (p. 146).

·  South Africa is not a member of the OECD (instead, South Africa is an Associate in 6 OECD Bodies and Projects, and a Participant in 15).

·  South Africa receives official development assistance (ODA) from the OECD.

So, we have described the Developed world as defined by membership of The OECD.  Also the Collins English Dictionary. Copyright © HarperCollins Publishers: Noun : the industrialized and economically advanced countries of the world collectively – Also called: First World, global north.

The advert's goal is not to sell anything but rather to inform and educate and therefore on the advert we supply a link for more information where everything that I have stated above is explained. We believe that the claims made are reasonable conclusions to draw from the available data and defined in a way that is right and proper and, therefore, informative and educational rather than misleading in any way. We also believe that given the restrictions on words and readability that we have conveyed sufficient information on the adverts.

We are at your disposal should you wish any further clarifications and happy to tweak the adverts if you think they can be made clearer in any way. Please also acknowledge that the above information is provided to help you with your research into the complaints. However, as we do not yet know the wording or nature of the complaints the above does not constitute our official response to the complaints themselves.

Gordon MacIntyre-Kemp 

On behalf of Business for Scotland Ltd and the Believe in Scotland campaign.


As you can see there is no doubt pensioner poverty in Scotland is caused deliberately by the UK government policy of paying the worst pension in the developed world in order to increase private pension fund profits in the City of London.

The ASA was not moved to agree with the complainers that the adverts should be removed nor that in this case - given the nature of the claims in the advert - that they had the power to do so.  Our adverts remain in prominent positions on main through roads and key routes leading to supermarkets (which are still open during lockdown). The Truth is still out there.

How will Scottish independence impact in private and occupational pensions?

Many people have asked us what impact independence is likely to have on their existing pension schemes and investments.  In another post which you can read here, we have covered the state pension situation after independence. In that post, we have pointed out that:

  • The UK has the worst state pension in the developed world. In 2016 it was only worth 29% of average income.
  • The EU average is 70.5% meaning that UK pensions receive more than two times less than comparable countries.
  • The 2019 SNP Conference voted that in an independent Scotland the Scottish Government should create plan to increase the Scottish state pension to the EU average, effectively doubling it.  The plan has not been published yet.

With regard to private pensions, we researched the facts and we found the following: 

The truth

Occupational pensions will not be affected by independence. Private pension assets will be protected by existing legislation after independence. These include personal pensions, cash ISAs, lifetime ISAs and private investments without a fund to administer them. You will still be able to purchase bonds and tax-free savings but the Scottish Government, and not the Westminster, will be responsible for those bonds and making contributions. 

The facts

Occupational Pensions

  • Each occupational pensions scheme establishes the conditions that govern the operation and that the company has to fulfil regardless of political circumstances, in advance. If you are due an occupational pension you will get your full pension entitlement in an independent Scotland as your contract with the pension supplier will still stand.  
  • In the case of final salary pensions, also known as defined benefit schemes, a fund is obliged to pay you the amount that was agreed in advance. The only occasions in which this has not happened has been when the firm has gone into liquidation, in which case there are adequate industry protections to guarantee your investment.
  • The ultimate backstop is the Pension Protection Fund (PPF), which protects the entire pension of those who have already retired and 90% of those who are still working. This is subject to an annual cap of £38,505.61
  • All protections that exist as part of the UK will also be in place in an independent Scotland.

Private Pension Assets

  • Currently, private pension assets are mainly held in banks and other institutions which operate cross-nationally. For instance, the largest banks in Scotland are; Royal Bank of Scotland (owned by the UK Government), the Bank of Scotland (owned by Lloyds group) and Clydesdale (owned by an Australian banking group). These, and other banks, are all covered under UK regulatory frameworks because they are either headquartered in the UK or have subsidiaries there. Following independence, those companies will simply designate their offices in Scotland and England as their registered office for that nation and work under the pension laws of that nation. Your pension will be registered with the bank/pension provider in the nation in which you live. 
  • The position expressed by the Scottish Government is that tax-free savings products, such as private pension savings, will be supported and honoured in full after independence. These savings products will also be protected by compensation schemes, providing protection in line with European harmonised rules of consumer protection.
  • Scottish based savers will be Scottish residents and therefore no longer UK residents when it comes to tax-free savings and so will have access to tax-free savings schemes operated by the Scottish Government. Savers will be able to keep existing UK savings without paying tax on them but will not be able to contribute additionally to those specific UK funds. This is because the UK government pays towards these schemes and new schemes towards which the Scottish Government will contribute will be put in place.
  • National Savings and Investment bonds will also be treated the same way. Scottish based investors will not be able to invest additional money in UK bonds but will be guaranteed their returns on existing investments and allowed to keep their NSI open. These private investments will continue to enjoy 100% security. At a government level, such financial assets will be divided between the two nations upon independence. The Scottish Government will have its own bonds and savings products that people will be able to invest in.
  • In the event of an independent Scotland launching its own currency, your private pension will be paid in the Scottish currency, it is likely that the Scottish currency will be pegged to the pound sterling.  However, in the case of currency fluctuations, the policy under development from the Scottish Government is that the value of your currency will be protected and that there will be no detriment due to currency fluctuations. The full economic prospectus for independence will be produced prior to a new referendum campaign and we will link the relevant commitment to this page to confirm that arrangement.


The question is not so much whether occupational pensions and private pension assets are protected as it would be fair to say that this is a certainty. The question, thus, is: how are they going to be protected? What would be the arrangement or policies put in place by the Scottish Government that would ensure this protection?

It is likely that a deal would be reached in which the Scottish Government would accept the full liability for pensions, in order to guarantee their value and for continuity. That is in Westminster's interests as well, as they would be required to honour these commitments anyway. It would also provide a guarantee for people from the rest of the UK that are living and saving in Scotland.

The Institute of Faculty and Actuaries has proposed a number of regulatory options for Scotland after independence, each with different trade-offs and benefits. An agreement with existing UK bodies could be reached, with the benefit of continuity, coverage and cost-effectiveness. However, this would limit the Scottish Government’s ability to tailor the insurance market and would require negotiations.

A likelier solution would be to create new equivalent Scottish regulatory bodies, which would likely be funded by a proportionate industry levy (as is currently the case for the UK bodies). This would offer flexibility and the capability of changing regulation.

The Scottish Government’s stated policy is to give priority to reaching a single agreement for the joint regulation of occupational pensions, which would minimise disruption, yet offer little flexibility. The rules and practices of the UK Pension Regulator will also be adopted. The government would also establish a Scottish equivalent to NEST, providing both continuity for those already investing and giving the Scottish Government greater control over future contribution rates.

The second-choice option is to establish a Scottish pension regulatory and pension protection scheme to achieve regulatory alignment for occupational pensions, as well as private pension assets.

Does independence put our pensions at risk? 

Many people ask and it's not unreasonable to do so, will their pensions be a risk in the case of independence for Scotland. We say that the question instead should be whether pensions are at risk now, whilst Scotland is still part of the UK? We researched the facts and we found the following:

The Truth

Pensioners are worse off in the UK than almost anywhere else in Europe. An independent Scotland can do better by respecting pensioners in a way the UK does not.

The Facts


The UK’s pension system is fundamentally unfair for older people and pensions are far from safe by staying in the UK. The UK state pension system is failing older people and is unsustainable for future generations. It is inadequate to help pensioners live a life free from worrying about financial security.

In addition to all the above, a motion was passed at the SNP Conference (2019) calling for a commission to look into increasing the State Pension in an Independent Scotland to the same level as the OECD average and supporting the commissioning of a Scottish State Pension Plan. We will provide a link to that plan here when it is published. 

Following the publication of our first Pensions FAQ (above) in January we received some more detailed questions on pensions and we are happy to answer them here. Firstly

Q 1) A major problem for me in 2014 was that I wasn’t sure if my existing pension could be put at risk by independence. The question which must be answered properly is - how will my existing UK state pension be guaranteed after independence?

Q 2) State pensions. I paid 40+years contribution to the DWP. After Independence who would pay our pensions, DWP or Scotland?

Q 3) Will an independent Scotland be able to pay the average EU pension (as % of the average wage) that the SNP has set as a goal?

We know that the question of pensions in an independent Scotland is an issue for many people, particularly those already in receipt of a state pension. It could be said that this issue played a decisive role in deciding the 2014 independence referendum, largely as the Better Together campaign regularly spread fear amongst older people about the potential risk from independence that just was not borne out by the facts of the matter. So, it is important to make sure people have the answers to their pensions questions this time, thus eliminating any room for doubt.

On page 20 of the report about pensions in an independent Scotland published by the Scottish Government in 2013 it states:

Everyone currently in receipt of the Basic State Pension, Graduated Retirement Benefit, State Earnings Related Pension Scheme or the State Second Pension would receive these pensions as now, on time and in full.

For those in Scotland in receipt of the UK State Pension at the time of independence, the responsibility for paying that pension would transfer to the Scottish Government.

For those people of working age, who are living and working in Scotland at the time of independence, the UK pension entitlement they have accrued prior to independence would become their Scottish State Pension entitlement.

There is also the statement by the then UK Minister of pensions, Steve Webb, who told ‘a Westminster committee those who had "accumulated rights" would be entitled to the money.’ In particular, in answering the question of pensions if Scotland had voted for independence, Mr Webb said:

"Yes, they have accumulated rights into the UK system, under the UK system's rules.”

He added that the money would be paid out at the pension age decided by the UK government, rather than any future Scottish government. He said: "Take a Scottish person who works all their life and then retires to France... they still have an accumulated pension right in respect of the National Insurance they have paid in when they were part of the United Kingdom.”

Asked whether citizenship would matter, Mr Webb told MPs: "Citizenship is irrelevant. It is what you have put into the UK National Insurance system prior to separation. Answer [for example] 35 years, that builds up to a continued UK pension under continuing UK rules. They are entitled to that money. The question is, who is paying for it, and how is that [cost] split?"

Meanwhile, there is also the case of the Department for Work and Pension (DWP) response to the same question, known also as the ‘DWP letter.’ According to the initial response to the question, a letter which is now notoriously difficult to find online, at least in good quality, ‘the UK state pension would continue to be paid to people living in an independent Scotland.’ In particular, according to an article about the issue on the BBC’s website, the letter, written in the name of a pension customer service advisor on 4th January 2013, stated:

"If Scotland does become independent, this will have no effect on your state pension - you will continue to receive it just as you do at present."

As the same article adds, ‘in a subsequent statement, a DWP spokesman said’:

"We will look into this specific letter in case any misleading information was inadvertently given out.

"However, what is absolutely clear is that it will be the responsibility of an independent Scottish government, not the UK government, to make arrangement for pensions for citizens of an independent Scotland.

"There can be no guarantee that it will be at the same level as it is now."

This response from the DWP clearly aims to create unnecessary ambiguity, which will be cleared up later in this post. However, this response by the DWP also raises the other important issue that needs clarification; the level of pensions in an independent Scotland. The state pension might not be at the same level as it is now - it could be higher.

The SNP conference in 2019 agreed that ‘as a minimum, an independent Scotland should plan to meet the OECD average for a Scottish State Pension as a top priority for all Scottish pensioner’s.’ This is to say, there is clearly a willingness by the SNP to increase the state pension to the OECD average. This would mean an increase of around £200.00 per week per pensioner. To be clear, the UK pension is currently the lowest in the EU, as referenced earlier in this article.

The Scottish Government have been unequivocal that people in Scotland will be entitled to a state pension if they meet the current minimum criteria for it. The minimum qualifying accruement for the new state pension is 10 years, although in order to get the full state pension 35 years of NICs are required. After independence, entitlement would continue to be built up in Scotland towards a Scottish state pension. This is similar to how state pension entitlement is transferred across EEA countries.

This would be paid for either by the UK government or by the Scottish government, subject to pre-independence negotiations. It is plausible that the Scottish government would inherit the full pension liability as part of the negotiation. This would however require payment from the UK government to the Scottish Treasury to release the UK Government from its obligations to pensioners, obligations that are cast iron. This would allow the Scottish government to make a guarantee that pensions would be protected and rates maintained.

Such an arrangement would be in the interests of both parties - it would allow the UK government to be freed of having to pay pensions across borders, saving bureaucracy, and the Scottish government to provide a 100% assurance that rates would be maintained or increased. This solution would be good for the people of Scotland who have already accrued a portion of a UK pension through NICs, as they would only eventually want to receive their pension from one government.

For now, the cost of providing a pension in Scotland is around 6-8% cheaper than in the rUK because of lower life expectancy. Furthermore, the Sustainable Growth Commission’s (SGC) figures suggest that the taxation raised in Scotland is sufficient to pay for all services currently devolved as well as cover the pension and social security arrangements paid in Scotland by the UK Government.

In addition, as we have already pointed out, Scotland is one of the world’s most naturally wealthy countries. The value of Scotland’s natural environment to the economy is huge and lays the foundation for Scotland’s continued prosperity as well as a sustainable economy that respects the planet and future generations. It would be fair to say that Scotland’s natural wealth, alongside the other advantages of the Scottish economy discussed in our website and publications, would make it possible to afford a state pension at the OECD average level.

The infrastructure to deliver pensions is already in place. The Pension Centres, which are currently part of the Department for Work and Pensions (DWP), will continue to administer and manage state pensions. These are based in Motherwell and Dundee. The SGC estimates that public sector employment in an independent Scotland would increase by 1%, with 100 extra staff being required in social security and pensions at a cost of £25m. However, they would also generate additional tax revenues of £1.5m, as well as immeasurable benefits from increased personal spending.

To be clear, the cost of pensions to an independent Scottish Government would be the same or lower than they are right now unless the Scottish Government decided to increase the amount to a higher level than they are as part of the UK. There are no significant additional pensions costs to the Scottish Government associated with independence.

An indication of how a state pension system would operate across borders after Scottish independence can be seen in current pensions practices. It is a fact that state pension entitlement is based upon accruing sufficient NICs over a person’s working life. This is built up regardless of the nationality of the person working, or the country of residence. In 2012, the UK government paid state pension to 1.2m people living outside the UK.

This would happen in an independent Scotland. According to the National Institute for Economic Review, cross-border state pension liabilities would be relatively small if Scotland decides to become independent.

When it comes to raising state pensions to the OECD-average level, it is certainly encouraging that the SNP, as the pro-independence party and the one currently in government in Scotland, is making plans to make this happen. This though may not happen instantaneously. It would be logical to forecast that pensions in an independent Scotland would gradually reach the OECD-average level over time.

To summarise, the UK government has a legal obligation to pay pensions to all those who have paid into the system via their National Insurance Contributions during their working life. The UK government would therefore continue to pay pensions as normal, whether pensioners lived in an independent Scotland, France, Spain, or in any other country. To get out of that obligation, the UK government could choose to make a capital payment to the Scottish Government as part of the independence negotiations. In that case the Scottish Government would take on the responsibility to pay UK pensions to pensioners living in Scotland.

If you have any more questions about pensions in an independent Scotland please submit them on the FAQ for to the right of this blog.