THERE does seem to be massive confusion and blustering on both sides of the argument on state pensions, which seems to ignore the actual realities and complexities of any attempts to separate the Scottish State Pension payments from the rest of the UK.

There is no way of knowing how this will play out in practice, but it is absolutely up for important negotiations. The situation is quite unprecedented and, if no agreement is reached, would need to be challenged in court to determine where responsibility lies, how to assess that responsibility, and how to allocate funding.

There are several pointers from past practice that would be factored in here. Ultimately, of course, it is really hard to imagine that the British Government could refuse to honour National Insurance (NI) state pension accruals in some way, just as is done for all expats living abroad anywhere else.

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As far as I am aware, it would be pretty much impossible to identify who paid contributions in Scotland, who paid contributions in the rest of the UK, what they paid, what their employer paid, and how each would be allocated. Someone living in Scotland and working over the Border in England, for example, would have a claim on both countries if responsibility were shared – someone living in England and working over the Border in Scotland likewise.

I feel this is a potential minefield and anyone who claims it is simple is misleading others. It is not simple at all, but would need to be carefully negotiated. A financial settlement of some kind seems most likely, but will be part of an even wider picture.

What is somewhat less difficult to see is that there is another minefield related to public sector workers’ pensions.

The UK public sector pension schemes for NHS, teachers, civil service, firefighters, armed forces etc are all unfunded. These schemes promise a specific level of future pension income, with full inflation protection, and that commitment is made by the UK Government.

The sums are potentially enormous too and, in line with established law, there can be no diminution of these occupational pension rights. They are individual rights backed by UK taxpayers.

With state pensions, there is not an actual legal right to specific pensions, which is why the UK Government could refuse to pay any future inflation linking, but the NI system does promise a state pension at state pension age to those with at least 35 years of NI contributions on their record. I do not believe NI records the country in which contributions originated, whether it is England, Scotland, Wales or Northern Ireland. Indeed, pensions would be a real headache all round.

Ros Altmann is a leading pensions expert who was awarded a CBE for her service to the issue. She was later made a peer and pensions minister. You can follow her blog at