40% gender difference in pension pots
5 Nov 2018
The gender pension gap is 39.5%, twice the level of the gender pay gap, with women receiving on average £7000 less than their male counterparts, according to research from the union Prospect
5 Nov 2018
The figures for 2016/17 are based on its analysis of responses to the Department for Work and Pension (DWP) Family Resources Survey. In comparison, official calculations put the level of the gender pay gap at 18.4% in 2017.
The gender pension gap is defined as the percentage difference in average gross pension income for women receiving the state pension compared to the average gross pension income for men in receipt of state pension.
In analysing the causes of this gap, Prospect’s report found that occupational pension income is linked to salary, so the gender pay gap feeds through to lower pension income, meaning women continue to be penalised even after they have retired.
However the gender pension gap is even bigger than the gender pay gap because women bear a disproportionate share of the burden of caring for children and other relatives and this leads to extensive gaps in their occupational pension scheme service.
Sue Ferns, Prospect senior deputy general secretary, said: ‘These figures reveal the shocking scale of the gender pension gap and clearly demonstrate the need for the government to both recognise the issue and act urgently to address it.
‘Gender-based economic inequality may start in the workplace, but it follows women for the rest of their lives.’
In order to address the issue, Prospect is calling for the government to introduce a statutory requirement for DWP to report annually on the gender pension gap, in order to focus attention on the problem and help build a consensus for action to tackle it.
The union also wants to see positive recognition of caring responsibilities in the state pension system, credits for people who opt out of receiving child benefit, and tax relief for low earners in net pay pension schemes.
Fern said: ‘There are also practical steps that government must take such as abolishing the automatic enrolment earnings trigger which disproportionately excludes women from occupational pension scheme membership.’
Tackling the gender pension gap is here
Report by Pat Sweet