It has been well documented for some time now that there is a significant pension income gap between men and women.
Prospect Union has calculated that the income gap currently stands at 38% and to put that into context, this figure is currently twice the amount of the gender pay gap.
The TUC has flagged 19th
May 2022 as “gender pensions gap day” as a 38% pension income difference effectively means that women must wait 38% of the year, equal to 139 days, before they receive their pension.
The TUC has commissioned some new analysis of ONS (Office for National Statistics) figures and they have reported that in wholesale and retail women between 45 and 64 have less than a fifth-just 19% of the pension wealth of male colleagues-this is nothing short of scandalous.
The most obvious reason for this disparity is because of the unequal division of caring responsibilities. Women are much more likely to take time out of work or reduce their hours of working to look after children and so this makes it difficult to build up a workplace pension.
Women have historically earned less than men - due to the gender pay gap and because a large number of women work part time, they do not always meet the eligibility criteria to be auto enrolled into their workplace arrangements.
It’s not just workplace pensions that are impacted either. There have been historical differences in National Insurance resulting in women receiving lower State Pensions and Usdaw has been highlighting the recent errors made by the DWP resulting in many women receiving underpaid State Pensions.
Usdaw agrees that this unequal treatment is outrageous and urges the Government to acknowledge this issue. Furthermore, we believe now is the time for Government to review the Auto Enrolment legislation, which will further help women to close the gap.
Usdaw has already called on Government to:
- Reduce the minimum age for workers to be enrolled into a pension scheme from 22 to 18, to encourage early saving for retirement.
- Scrap the current earnings threshold of £10,000, to help low-paid, part-time and multiple job workers, who are predominantly women, to get on the first rung of the savings ladder.
- Gradually increase the current minimum contribution rate of 8% (employers currently only have to contribute a minimum of 3%).
Usdaw also supports the concept of the introduction of State Auto Enrolment contribution credits for those who take a career break - which could potentially make a significant difference in reducing the pensions gender gap.
Usdaw is committed to campaigning and supporting our members, along with our workplace reps, raising pension awareness and encouraging conversations around money and planning for the future.
Our campaigning also seeks to tackle the deep rooted inequalities in society.