The Gender Pension Gap  

Last month the Government released a briefing paper on The Gender Pension Gap (April 2022), which refers to the different retirement outcomes for men and women. The briefing paper examines the causes and possible responses to the gender pension gap.

Gender Pension Gap

Gender Pension Gap refers to the percentage difference in pension income for female pensioners compared to male pensioners. Across the UK, there are vast differences in the value of men and women’s pensions.

While the Gender Pay Gap has been slowly declining over time there is still a significant difference in earnings between men and women, which causes the gender pension gap.

What Causes the Gender Pension Gap?

As stated in the Government’s briefing paper The Gender Pension Gap (April 2022) there are 3 fundamental factors which constitutes to the difference in pension assets held by men and women:

  1. Women are more likely to be in part-time employment or unemployed compared to men. This means there are less pension contributions. The reason for this is women may provide unpaid care to children and elderly relatives.
  2. An employee needs to earn at least £10,000 to qualify for an auto-enrolment workplace pension. Women are more likely to be working lower paid jobs and are less likely to qualify for a pension.
  3. Greater life expectancy for women than men therefore they need income in retirement for a longer period.

How to Resolve the Gender Pension Gap?

In the briefing paper the Government proposed 3 reforms to resolve the causes of the gender pension gap:

  1. Provide affordable childcare for pre-school age children so women can return to either part-time or full-time employment.
  2. Reduce earning trigger to qualify for auto-enrolment workplace pension.
  3. Make pension rights a compulsory part of divorce proceedings.

Recommendations from the Gender Pension Gap

The Gender Pension Gap briefing paper recommends that the Government should consider changing the law to ensure pension rights have to be considered by the Court in any divorce; not just divorces where a financial order is applied for.

In addition to this the briefing paper recommends the pension sharing process should be streamlined to minimise delay in implementing any sharing order.

Divorce and Pensions

Pensions are often neglected in divorce settlements, particularly where the parties do not have legal representation.

There are three main options when dealing with pensions in a divorce, these include:

  • Pension Sharing Orders – Pension Sharing Orders from the Court establish how the pension should be split when a couple divorces. The pension is divided into two separate pots and each ex-spouse has a share, which they control themselves.
  • Pension Offsetting – A pension is kept by the holder and its value is trade offset against other joint assets.
  • Pension Attachment – A percentage of someone’s future pension income is paid to their ex-spouse when they start taking their pension.

For advice on divorce and pensions please contact our Divorce and Family Law Solicitors on 033 3344 9600.

Divorce and Family Law Solicitors

If you are getting a divorce and would like legal advice on Pension Sharing Orders, Pension Offsetting or Financial Orders in divorce, contact our experienced Divorce and Family Law Solicitors.

Our solicitors will listen to your individual needs and work tirelessly to secure your financial future and ensure the best outcome for you and your family.

We offer our divorce and family law services at your convenience either in-person, over the phone, via email and through the post so you can access our exceptional services wherever you live.

Call us on 033 3344 9600 or simply email [email protected] with your request to find out how we can support you.

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