Office of National Statistics

Female pension Pots Continue to Decrease

Labour Party

In February I wrote about how women are penalised with smaller pension pots because of the disparity in pay they throughout their working lives. This was backed up by research from the Office of National Statistics (ONS) which stated women earn less which in turn means they are able to contribute less to a pension pot.

And research published last week found women retiring this year will receive the lowest annual pension income since 2008, and receive £6,500 less than men, a report suggests.

The research found that the disparity in men as women’s annual income post retirement has actually increased by £750 since 2012.

The annual survey conducted by Prudential revealed average income for women is 64% that of men’s. It also found that women’s annual income after retirement is on average less than two-thirds (64 per cent) that of men.

This isn’t all. The situation is serious because following a high point in 2009 women’s pensions has entered a steady decline of £500 each year. Men meanwhile have enjoyed an increase this year with an increase of their income of £250 (on average).

It is well documented that the economic downturn has had a significant impact on female earning capability and this has led more women to take on part-time roles in order to still be able to contribute; but the obvious consequence has meant women have not been able to contribute as much as they would like towards their pension pot. Essentially women put family needs before their own.

The introduction of auto enrolment, where employers are obliged to enter all employees into a pension scheme may help alleviate the problem a little. However, in reality, and as a spokesperson for Prudential pointed out when interviewed by the Times newspaper on this subject last week, the gulf in retirement incomes has grown and it’s continuing to do so. The spokesperson predicted the gap would not disappear “for years to come”.

The Government promises the controversial single tier pension scheme will benefit women, but the above indicates significant and very worrying problems in the short to medium term and possibly beyond that.

Honeyball’s Weekly Round-Up

Labour Party

It was quite a week in which to highlight women’s rights or rather the lack of it.  

The week didn’t begin well with some startling comments from Justice Secretary Kenneth Clarke and then we heard the news that the number of women claiming out-of-work benefits has hit its highest level since 1996, with public sector job cuts starting to bite last month.

Not only that but the government is making life even more difficult for single mothers whose children are aged seven or above in an ill thought out attempt to encourage single mothers into the workforce.

Instead of positively encouraging mothers to get back into the workplace its policy pushed the figures of the number of women claiming jobseeker’s allowance (JSA) up, as they are stripped of income support once their children turn seven.

Figures from the Office for National Statistics showed that 474,000 women were receiving JSA in April.

According to the broad International Labour Organisation measure, there was a rise of 12,400 in the more timely claimant count last month – with more than three-quarters of the increase among women.

It was the 10th consecutive month in which the number of women claiming out-of-work benefits had increased – although there are still more than twice as many men, 994,000, receiving JSA.

The Department for Work and Pensions said part of the rise resulted from rule changes that have seen single mothers shifted on to employment benefits to encourage them to look for a job. The full story is here.

Hundreds of women marched on Parliament to demonstrate against the government’s decision to raise the state pension age to 66 six years earlier than planned.

The protestors converged to demand the government altered its plans to raise the state pension age for women to 66 six years earlier than previously planned.

The event was organised by Age UK who are concerned at the rushed nature of the proposals which will not give women enough time to plan and therefore will plunge scores into poverty, it claims.

Many of the women affected are either carers or in poor health, meaning that working for longer is not an option, Age UK says. It hopes the protest will increase pressure on MPs to vote against the state pension increase.  Details of the campaign can be found on Age UKs website here.