Research carried out by PensionBee has revealed that depending on age and location, the UK gender pensions gap is as high as 57%.
The online pension provider found UK men have saved £24,236 towards their retirement compared to just £15,006 saved by UK women, which is a 38% gap in the size of their pension pot.
The largest gap of 57% is in Northern Ireland, with average retirement savings for men totalling £17,883 versus £7,737 for women. The north east and south west of England both have gaps of 46%, with men saving £20,514 compared to women saving £11,177, and men saving £24,641 compared to women saving £13,326 respectively.
Meanwhile, those living in Greater London have the lowest gender pension gap of 28%, with men saving £24,853 and women saving £17,863.
The research, analysed the data of more than 65,000 people, also highlighted that the gender pay gap widens with age. It discovered a 46% gap among those aged 50 and over, with men and women saving £52,592 and £28,249 respectively. This is more than double the 18% gap of savers under 30, with men and women having pension funds of £3,925 and £3,215 respectively.
Romi Savova, CEO of PensionBee, said that it is “incredibly disappointing” to see that where a pay gap exists for women, a pensions gap will follow.
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“At the same time, female savers must be encouraged to keep paying into their pension, even when taking breaks from paid employment or working reduced hours. Women are more likely than men to take time off work to look after children, and many women stop contributing to their pension while on maternity leave. The combination of lower salaries and long career gaps, with little or no pension saving for years, are a massive disadvantage for women,” she said.
“The benefits of compound interest and tax tops from HMRC make a pension an attractive long-term investment, and the more women can contribute their pensions now, the more they will be able to improve their quality of life in retirement,” Savova added.
3 comments
Not just private and dcs pensions, what about dbs and the effect of clawback. HSBC has c52k dbs pensioners affected by clawback, which takes up to 30% back from the lowest paid but only 2% from the highest and the majority of lowest paid are women, while the majority of the highest paid are men. See http://www.midlandclawbackcampaign.co.uk
I’m not surprised at the gap between male and female pensions. HSBC (formally Midland Bank) treated women poorly throughout the 1960’s, 70’s, and early 1980’s. The perception was that women would only work for a few years before getting married and leaving to have a family. And should they return, they were forced into the lower paid jobs. Yet the men were encouraged up the career ladder, thereby earning more, and hence a larger pension.
But HSBC went one stage further. From 1975, the contracts for all new recruits included a pension clawback clause. However, this was not linked to the expected pension amount, but instead to the number of years you worked.
So a lowly paid women with say 20 years service would be subject to exactly the same clawback, (pension monies withheld) as a man who also worked 20 years, and progressed his career. Some of the women are seeing 30% or more of their pension withheld, whereas it might be only 2% or 3% for men.
51000 former staff are caught in this trap, making figures even more squewed.
And even though they know all about it, HSBC choose to do nothing. #fightingforfairness
At HSBC, pension scheme members of The Midland Section, Defined Benefit Scheme, especially the lowest paid, who happen to be mainly women, can have their occupational pension reduced, in some cases, by as much as 30% plus, on reaching state pension age.
Their pension pots are much smaller than those of senior managers, mainly men, and yet the calculation for Clawback is the same for all, plunging many of the lowest paid into financial distress.
We are repeatedly told that Clawback is legal, it was created in 1948, now however, it is outdated and has no place in an enlightened and fairer society. Its existence exacerbates the pension pay gap.
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