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Last Updated: Wednesday, 2 November 2005, 13:32 GMT
Women warned over state pension
A woman and a baby
Pension prospects can be harmed by having a baby
More than two million women are not building up any entitlement to the basic state pension, according to the Department for Work and Pensions (DWP).

Many women miss out on a full state pension because they earn too little or take time off work to look after children or relatives, the DWP warns.

In addition, women are less likely than men to have a private pension.

The government's Pension Commission will report on how women's pensions can be boosted on 30 November.

The Pensions Minister Stephen Timms told BBC Radio4 that the current state pension system is unfair to women.

"The report does show that the National Insurance system hasn't been delivering fair outcomes up to now," he said.

"Thirty per cent of women reach state pension age at the moment on a full basic state pension, compared to over 80% of men."

Are changes needed?

Amongst a welter of statistics, the 151-page report points out that currently only 23% of women retiring at 60 are doing so in receipt of a full basic state pension.

It's just not acceptable to condemn women to waiting another 20 years for equal state pensions
Dr Katherine Rake, Fawcett Society

Of those, only 17% are doing so as a result of building up full National Insurance contributions through their working lives.

An additional 6% are getting the full state pension as a result of gaining some extra entitlement based on their husbands' contributions.

Even so, the report suggest this inequality between men and women at the point of retirement will erode over the next 20 years.

According to forecasts by the Government Actuary's Department, by 2025 men and women will reach the state retirement age of 65 with similar state pension entitlements.

The average man or woman will then be eligible to over 90% of the full basic state pension.

The main reason for the improved outlook for women is that more of them will have been working for longer.

They will also have benefited from the policy of crediting NI contributions to women who are at home, looking after children or caring for adults or disabled children.

But Dr Katherine Rake, director of the campaign group the Fawcett Society, took a dim view of the idea that time will erode the inequalities highlighted in the DWP report.

"It's just not acceptable to condemn women to waiting another 20 years for equal state pensions - and even then many lone parents and black and minority ethnic women will be left behind," she said.

Gender gap

The DWP report highlights in many other ways the pensions gap that exists between men and women in the UK.

You feel kind of ashamed that you are having to do it, telling people all about your personal financial income... they said it wasn't means testing but it was
Ann Green on her application for pension credits

Fewer women are contributing to the basic state pension and as a result have to claim the pension credit, a means-tested benefit.

Women comprise 2.2 million of the 3.3 million people in receipt of the credit, the DWP report said.

On top of that, fewer women than men contribute to a private pension.

In total, 38% of working age women are paying into a private pension - compared to 46% of men.

And even when women do pay into a private pension they are failing to build up as big a pension pot as men, the report found, with men receiving on average 50 to 100 a week more private pension income than women.

Commenting on the report, the TUC said that action was needed to close the pension gender gap.

"This report increases pressure on the government and the Turner Commission to bring forward radical proposals to tackle the future of pensions," said Brendan Barber, TUC general secretary.

"Women will not get a fairer deal without big changes in state pensions and moves to compel employers to pay their share," he added.


The problem of how to lift people out of poverty when they retire is currently the subject of intense scrutiny ahead of the publication of a report from the Pension Commission, headed by Adair Turner.

Women will not get a fairer deal without big changes in state pensions and moves to compel employers to pay their share
Brendan Barber, TUC general secretary

At the recent Labour Party Conference the former Work and Pensions secretary David Blunkett said that a solution was needed for the "scandal" of low pension provision for women.

Some groups have called for the introduction of a "citizens' pension" specifically to help women.

Under a citizens' pension, entitlement to the full state pension would be based on residency rather than National Insurance Contributions (NICs).

However, pressure group Age Concern said a citizens' pension would be too hard to administer.

Instead, the group said that it would be easier to reduce the number of years people need to have worked to qualify for a full state pension.

It said if this was reduced from 39 years to 25 years, the majority of women would be entitled to the full state pension.

Are you affected by issues covered in this story? Send us your comments using the form below.

Your comments

The main problem for me is that the pension system is so outdated. Most people these days do not work their entire life employed by one employer. Many of us both male and female take time out to look after children, elderly relatives or start our own businesses. I have paid in to a pension both personal and NI since I was 16 BUT at 40 I now find that I have a few years when I will be unable to pay in to any pension for a few years. However no one can tell me how this will affect my income in retirement, all anyone will say is that it is not enough!
Jan, Beds

I went back to work in 1978 after taking 7 years off to look after my two children. When I went back I paid the low married women's stamp. At the time I was advised that if I did not want any more children it was not worth paying the full stamp. I was told that it would only be worth paying the full stamp in order to gain maternity allowance. I started paying the full stamp in 1988 and retired in 2004. As a result of this I only receive 40.50 per week. I feel bitter about this. What has happened to the NI I paid out when paying the low stamp?
Mrs Sheila Atkins, Burton on Trent, UK

Many women, myself included, find claiming benefits much too complicated and frustrating. After 37 years bringing up children, mostly single-handed, the last thing I need is to be confronted by a complex process of trying to comprehend the pension system. Certainly I never had the time to concern myself with it while I was bringing up my children. There's little wonder that many women fail to claim what is rightfully theirs. We are at the mercy of the system. Friendly, individual help is needed to ensure that each deserving woman receives her rightful benefit after contributing her skills of child rearing for the good of the community. Why should we be cast aside to die in poverty after giving our lives to our children?
Carol Richards, Scunthorpe, UK

Most people from my generation (1981) and social standing, cannot even begin to consider paying into a pension fund; we have student loans, massive council tax, high income tax - we cannot even begin to consider getting onto the property ladder! It is us - the ones who studied and sought honest employment who may suffer the most in the future. All we can do is pray that we earn enough money to support ourselves in future years, or even better - enough to emigrate from this country.
Frances Brocklehurst

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