Women & Pensions

Posted on: 25 March 2008 by Gareth Hargreaves

Pensions report shows ‘historical divide’ faced by women, says Pensions Minister Stephen Timms.

Pensions report shows ‘historical divide’ faced by women, says Pensions Minister Stephen Timms.

A new report on women and pensions published by the Department for Work and Pensions highlights the historical divides that women have faced in the pensions system, said Pensions Minister Stephen Timms.

The report examines how the state and private pension systems affect women and how in these systems have provided for women in the past and what we can expect to see in the future.  The report clearly shows that inequalities of income in retirement cannot be tackled in isolation from inequality during working life.

Key findings from the report are:

  • 1.3 million of the 1.9 million people lifted out of absolute poverty by Pension Credit are women.
  • Today 30 per cent of women at State Pension age are entitled to a full basic State Pension (and only 24 per cent on the basis of their own National Insurance contributions).
  • But by 2025 it is expected that women will have the same basic State Pension entitlement as men.
  • Fewer than 50,000 women in more than one low-paid job were not building up basic State Pension rights.
  • Men receive on average £50 to £100 a week more private pension income than women of the same age.
  • Female employment rates have increased from 55 per cent in 1983 to over 70 per cent now.
  • But only 38 per cent of today’s working age women are contributing to a private pension compared to 46 per cent of men.
  • Whilst women in their 20s and 30s are as likely as men to be contributing to a private pension, women in their 40s are less likely regardless of their work pattern.

Commenting on the report, Mr Timms said that important decisions on the future of our pensions systems are about to be made.  "This analysis is not about pre-judging the Pensions Commission report, it is about laying the facts on the table. Fairer outcomes for women will be central to the consensus we are building for a long-term pensions solution."

“What happens in your working life, affects how you will end up in retirement. This document examines what happens to women throughout their lives and provides a sound basis for deciding how we want the pensions system to work for women in the future. The questions raised by this document are not new but it takes us a step closer to providing the answers.”

Minister for Women and Secretary of State for Culture, Media and Sport, Tessa Jowell said; "The role of women in society and in the workplace has changed dramatically since the war and this change is now reflected in most of our institutions, inside and outside of work. However, many women are left disadvantaged by a pension system that is based on a view of society that is nearly 60 years old and which is largely predicated on women relying on their husbands for their retirement income, so it is right that Government alongside others considers how best we address this.”

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