12th July 2021
Women likely to miss out most if the Government scraps the triple lock - Barnett Waddingham
Amanda Latham, Policy & Strategy Lead at Barnett Waddingham, commented: “With recent analysis by the OBR predicting that state pensions could rise by as much as 8%, the pensions triple lock has once again come under fire. Deemed as an outdated policy that is costly to the taxpayer, it’s very clear that there are holes in the system. Any policy that is significantly undermined by a lack of public support needs to be addressed.
“What’s crucial, however, is that any changes to state pensions consider the people whose livelihoods and retirements will face the biggest impact. It is very possible that the biggest critics of the triple lock are the least likely to rely on a state pension in retirement – which as our research shows, is disproportionately women. Reforming the triple lock system is certainly overdue, as the unusually high growth rate proves, but it’s critical that the priority is to bring it to a quality that everyone values and supports. Within the pensions system as a whole, we should be thinking about how to create a more fair, robust and inclusive framework that gives everybody the best chance at building financial security for retirement in a targeted way.”
Research from Barnett Waddingham finds that women are far more likely to be relying on a state pension in retirement than men – raising concerns about women’s financial stability in later life:
- Three tenths (30%) of women do not have any private or workplace pensions, and will likely receive a state pension only at retirement, almost double the amount of men (17%) in the same position – showing that women have less savings and are less prepared for a financially stable retirement.
- The pensions gap widens even more, later in life. Almost two fifths (38%) of women over 55 will rely on a state pension only, compared to 17% of men over 55.
- The study shows that auto-enrolment is having more of an impact on younger workers, with 59% of millennial women (age 25-34) holding a workplace or occupational pension – more than the 58% of millennial men who do so.
- But it’s after the age of 35 that the pensions gap begins to diverge. By ages 45-54, 14% more men than women hold a workplace pension, at 67% compared to 53% - suggesting that auto-enrolment stops being as effective for women in mid-life, perhaps as a consequence of parental responsibility leading to part-time or lower-paid work.