A new industry coalition has been formed to tackle pension inequalities in the UK.
The Pensions Equity Group (PEG), which launches today is backed by over 20 pension companies and organisations. It has been launched to address the problem that many people in society are not saving enough for retirement and aims to support the role that large companies and scheme providers can play in supporting members.
Aviva is one of the major insurers backing this new initiative, and has campaigned for changes to AE levels to address this issue.
The company’s director of workplace savings & retirement Emma Douglas says: “Bringing together this comprehensive industry expertise will be a breakthrough in levelling up pension savings, which has been a long-time coming.”
Recent Aviva data found the gender pension gap begins to widen significantly from the age of thirty-five, and there are significant gaps between how much women pay into their pension compared to men.
Based on the workplace pension data for over 5 million pension plans the gap between women’s and men’s pension contributions for 35-39-year-olds is 21 per cent, up on the 18 per cent gap last year. It then increases to 24 per cent for 40-44-year-olds and 27 per cent for 45-49-year-olds before stretching to 32 per cent for 50-54-year-olds.
This imbalance persists into retirement with women aged 60-65 years old having pension pots which are on average just over half (57 per cent) the size of men’s pots at the same age.
Douglas adds: “The government’s commitment to transforming auto-enrolment thresholds has the potential to deliver a real boost to the pensions of women, who are far more likely than men to work part-time.The lowest earners, and those working multiple or part-time jobs, will benefit from getting pension contributions from the first pound they earn.
“We look forward to working with government to bring in these reforms. Now, in the middle of a cost-of-living crisis, is not the time for radical change but providing a clear ‘roadmap’ and timeline for these reforms will give employers and pension savers time to plan, helping to ensure better retirements.”
“There are widely varying ways in the which the gender pension gap is measured. This inconsistency is a barrier to assessing progress and we would like to see the government find a suitable definition of the gender pension gap alongside a metric for measuring progress on reducing the gap.”
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