Pensions  

‘Pension planning for women hits new low’

The pensions minister said flagship government initiatives such as auto-enrolment were likely to raise participation rates among women, but the next step would be to keep contribution rates among female employees consistent, even if they take time out of their jobs.

He was speaking at the House of Lords last week at the launch of the ninth Women and Pensions report from Scottish Widows.

The 24-page report claimed that pension planning among women had plummeted to an all-time low, and revealed a 9 per cent gender gap in retirement saving.

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Later, speaking at a one-off work and pensions committee hearing, Mr Webb said: “One of the criticisms of pot-follows-member is that it costs a lot of money to transfer pensions – and it does, but it shouldn’t.

“I’m encouraged when the industry get its act together as it can come up with far more streamlined ways of transferring money around at a much lower cost.”

The minister told the committee that he could not give a firm date for the introduction of pot follows member but said the department for work and pensions had “to get on with it” to ensure that “millions of silly little pension pots are not scattered across the economy”.

Industry view:

Ros Altmann, pensions consultant, said: “It is important that women are able to achieve good later life income and this probably needs to come from a combination of working longer and saving more if possible.”

Adviser view:

Ruth Whitehead, principal of London-based Ruth Whitehead Associates, said: “This is a global issue. Very few people are making sufficient provisions for the long term. We’re all living longer and have to make our money last and there are too many terrible pension schemes out there. Your pension has to stay with you all your life so it should be treated like a car, with MoTs and regular checks, so it can make that long journey with you.”