Ministers must fix ‘huge’ pension gap for women, says TUC | pensions

Unions have called on the government to take urgent action to correct a “huge pension gap” as research showed women working in many industries have half the retirement savings of men.

The TUC said Thursday was “Gender Pension Gap Day”, when female pensioners in Britain start collecting after going four and a half months without retirement income.

It called on the government to take urgent action as it revealed that the average pension gap had reached 38%, more than double the level of the gender pay gap (currently 15.4%).

In two-thirds of the industries, women have labor pensions that are worth less than half those of men, according to the union organization.

In manufacturing, wholesale, retail and other service jobs, women aged 45 to 64 have less than a fifth of the pensions of their male colleagues, it said.

In administration and support services, the average woman in the same age group has almost no pension and a retirement fund 100 times smaller than the average man in the same industry.

One reason for the imbalance is that many women take time off work or work part-time to care for children, making it difficult for their pension to grow. Women are also often paid less than men, meaning they accumulate fewer contributions.

TUC General Secretary Frances O’Grady said: “Women face a huge pension gap. And at the current rate of progress, it could take more than 50 years to close.

“Too many women are paying the price of retirement by taking time off work or reducing their hours when their children were young.”

She added: “Ministers must act now, or we will send more generations of women into retirement poverty.”

The TUC said ministers should address the problem by changing the automatic enrollment system and making childcare more affordable.

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The government said more women were saving for workplace pensions since automatic enrollment was introduced a decade ago.

A Department for Work and Pensions spokesperson said: “Automatic enrollment has helped millions more women save for a pension, with participation among eligible women in the private sector rising from 40% in 2012 to 86% in 2020, same as that of men.

“Our plans to eliminate the lower income limit for contributions and lower the eligible age to automatically enroll to 18 in the mid-2020s will enable even more women to save more and start saving sooner.”

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