Tuesday, 23 December 2008

Returning home

It is like the children of Israel fleeing the pharonic hordes. The expats are heading home; and it is the crashing pound that points the way back to Blighty.

Should we feel sorry for them? Should we shed a sympathetic tear for those that abandoned the motherland for warmer climates and more amenable house prices?

Frankly, I am in two minds. Anyone who moves abroad while retaining a sterling based income is asking for trouble. That is what banks call an open position. Since sterling has fallen from about 1.50 euros to almost parity, anyone earning sterling and spending in euros is bound to be in deep trouble. This kind of problem is entirely foreseeable. So, it is hard to feel terribly sympathetic.

However, something stops me from been too hard on our overseas brethren. The expats are the canaries in the coal mine. They are signaling that something is deeply askew with the UK economy. We have the lowest interest rates in 60 years, the biggest fiscal deficit since the war, and the economy is recession. It would be a strange world if the national currency didn’t reflect these difficulties. The returning expats are warning us that things are about to get really nasty next year.

So, I say welcome home expats. However, the way things are going here you might wish you stayed where you were.


mike said...

Ex-pats state pensions don't go very far. Especially when you consider basic foods like loafs of bread at the large supermarkets cost around 2 Euro's (Spain/Cyprus).

Things are going to get nasty unless substantial taxes are raised. Some tough decisions need to be taken.

One thing which I think will come out of this is to make people work longer for their full state pension and the level of state pension also being the same for everyone. I think this could be justified on the basis that
people these days are more financially aware and will keep a private pension if they want extra income during retirement.

In The Netherlands people must work for 50 years to get a full pension. Each year counting 2% towards today’s single persons maximum of about 1000 Euro's per month. It should be like that here so that the hard working people get more benefit. That would be one way to start making a saving. One example would be that anyone who entered the country at 36 years old and paid stamps for 30 years would then only get 60% of the full pension. This is correct on the basis that they did not contribute to the UK economy for 20 years and so why should they get the extra 40%. Though not a popular decision I think the government have little choice to do this other than to start reducing the pension significantly.

Also quite why any expat living in warmer climes is getting winter fuel payments is madness. This is a pure waste of money and is surely one area that will be clamped down on.

Nick von Mises said...

You have to be pretty desperate to return to Gordon's Britain after having made an escape. It's like walking back into a gulag because you didn't like the tundra.

Anonymous said...

What kind of expat still gets paid in sterling while working abroad? All the expatriates (refugees?) I know, including me, get paid in the local currency.

Anonymous said...

Dteve: tried talking to your friendly UK-based embassy staff lately?

Anonymous said...

Mike, they could always just cut the spending. Public sector workers have taken pay cuts in other countries. They might start reforming their own expenses. And do we need ID cards? Foreign Aid to nuclear power countries that can launch moon missions? Olympic games?

They suck enough out of the productive economy. The taxes are the last thing that should be raised.

Anonymous said...

In The Netherlands people must work for 50 years to get a full pension. Each year counting 2% towards today’s single persons maximum of about 1000 Euro's per month. It should be like that here so that the hard working people get more benefit.

Well, F*ck That!

I decided last year to spread my retirement by working part-time and travelling every 4-6 months.

I fully expect to be left to die in a pool of my own piss even if I contribute to the useless pension-pnzi way so I prefer to enjoy life now.

Electro-Kevin said...

Parents in-law are over from Cyprus. Things are getting quite worrying for them and Grumpa seems even less ebulliant than usual. (Grumpa - what our twins call him)

All this moving abroad in retirement seemed rather complicated and unnatural to me; alas, it wasn't my place to express my reservations more than once.

Of course, there'll be a room for them here if it comes to it.

Grumpa will have to mend his Scrooge-like ways though.

hatfield girl said...

The people going back to England are mainly elderly, state benefit claimants in whole or in part, and without real settlement in their EU country.

People who earn their living in euros, or non sterling at least, and live within families and communities are usually maintaining their base abroad and their house in England.