Women have barely half the pension savings of men, according to a new TUC-sponsored report published today (Tuesday).
The study, carried out by the Pensions Policy Institute, shows that women have, on average, £7,500 in savings in defined contribution schemes, compared to £14,500 for men.
And women typically have £32,000 in pension savings in defined benefit schemes, whereas men have £62,900.
The report, The Under-pensioned 2016, reveals large pension disadvantages for women, ethnic minority workers, carers and the self-employed.
The findings show:
The Under-pensioned 2016 report says reasons for the disparities include workplace discrimination, job segregation and the lack of flexible working.
The report warns that despite recent changes to state and workplace pensions, these stark divisions will remain unless the government takes further action. It states that workers from underpensioned groups are less likely to be eligible for auto-enrolment into workplace pensions than the wider population, typically because their wages are too low.
It explores the potential impact on underpensioned individuals of lowering the £10,000 earnings trigger for auto-enrolment, increasing contribution rates and dropping the system of banding that restricts the income on which pension contributions are based.
The TUC believes that these are key policies that the government should consider when it comes to review auto-enrolment in 2017.
The Pensions Policy Institute will launch the report officially at the TUC’s Congress House headquarters at 3pm today. Speakers will include Shadow Pensions Minister Angela Rayner.
TUC General Secretary Frances O’Grady said: “Today’s report is a sobering reminder of Britain’s stark pension divide.
“Everyone should have the chance of a decent retirement income, not just men in full-time employment.
“Women, carers and ethnic minority workers will continue to have a tough time in old age if swift action is not taken.
“We urgently need a debate on how unions, government and employers can work together to can build on the success of auto-enrolment.
“And we mustn’t shy away from looking at the underlying problems in our labour market that are driving these inequalities in pension saving.”
Head of Policy Research at the PPI Daniela Silcock said: “Though pensions policy has played a role in supporting adequacy, the underlying causes of retirement income disparities cannot be tackled solely through pensions policy.
“They involve labour-market, social and regulatory issues related to inequalities experienced during working-life. Therefore, addressing ongoing differences in private pension income would involve a joint effort from government departments, employers, social services, regulatory bodies and community support groups.”
NOTES TO EDITORS:
Pension savings (Defined contribution and defined benefit)
Pension group |
Defined contribution |
Defined benefit |
Men |
£14,500 |
£62,900 |
Women |
£7,500 |
£32,300 |
Carers |
£5,800 |
£6,000 |
Self-employed |
£10,000 |
£37,900 |
White |
£11,700 |
£45,500 |
Indian |
£10,000 |
£22,100 |
All |
£10,500 |
£43,400 |
Average state pension
Pension group |
Average state pension |
Men |
£10,088 |
Women |
£7,540 |
White |
£9,048 |
Black |
£7,228 |
Asian |
£6916 |
All |
£8,632 |
- The Under-pensioned 2016 is a report co-sponsored by the TUC, Age UK, the Joseph Rowntree Foundation and The People’s Pension.
- All TUC press releases can be found at www.tuc.org.uk
- Follow the TUC on Twitter: @The_TUC and follow the TUC press team @tucnews
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