Defined contribution (DC) pension providers have been urged to publicly disclose their gender pensions gap as part of a call for urgent action, after analysis from Legal & General (L&G) suggested the pace of change had been "glacial" in recent years.

The insurer pointed out that the gender pensions gap was 16 per cent at the beginning of women’s careers in 2021, reaching 55 per cent at the point of retirement.

However, whilst this marks a slight improvement on previous years, L&G noted that is only a one percentage point improvement since 2020, warning that progress has been made at a "glacial pace".

Furthermore, whilst the pensions gender gap narrowed from 34 per cent to 31 per cent for those in their 40s, it remained static at 17 per cent and 51 per cent for 30- and 50-year-olds, respectively.

In addition to this, the provider noted that the size of a man’s pension pot at the point of retirement was £26,000 on average, compared with just £12,000 for a woman, suggesting that the gap is expected to be broadly similar for all pots.

L&G acknowledged that there are a number of drivers of the gender pensions gap, including the broader gender pay gap, and the fact that women are more likely to take career breaks for childcare or as an unpaid carer.

It also argued that, much like the gender pay gap, the gender pensions gap is a “structural and societal problem” that will take time to resolve, stressing the need for “urgent action”.

"There are many factors that have led us to this point but very few solutions offered," stressed L&G commercial director of workplace savings, Katharine Photiou.

“We know that women feel significantly less confident, and are more likely to struggle on knowing where to start, when it comes to making financial decisions," she continued.

"Industry and government must therefore work together to ensure education and engagement around savings and investments increase."

In particular, L&G has urged all companies and DC pension providers to publicly disclose their own gender pensions gap, so that all stakeholders can understand the issue and work to fix it.

L&G has also reviewed its own gender pensions gap as part of this call for action, revealing a 60 per cent gender pension gap for L&G retirees, with an average gap of 32 per cent for current savers.

However, the provider has committed to monitoring this gap annually to ensure it is making progress, by reviewing internal support, processes and policies to make changes such as better support for menopause and a review of paternity and shared parental leave.

In addition to this, L&G has committed to raising the profile of the gender pension gap across the companies it invests in and to continue collating data in order to include it in its stewardship activities going forward.

The insurer has also created a working group with 14 of its largest clients, to them tackle inequality in their own pension schemes by the end of 2022 and plans to expand this group further in 2023.

More broadly, L&G highlighted a number of broader policy suggestions, which were previously made as part of the provider’s evidence for the Work and Pensions Committees’ inquiry into pension freedoms.

These recommendations include removing the eligibility age for auto-enrolment to 18 and basing auto-enrolment pension contributions on the first £1 of earnings by removing the £10,000 eligibility trigger.

In addition to this, L&G suggested allowing greater flexibility for couples to pay into each other’s pensions, promoting the inclusion of pensions in divorce proceedings, and prioritising the provision of suitable and affordable childcare.

Commenting on the call for action, L&G co-head of DC, Stuart Murphy, said: “These figures demonstrate the glacial pace of change on the gender pension gap, as well as the need for greater cross-industry collaboration between government, employers, pension fund providers and members to address the scale of the challenge.

“In our view encouraging full disclosure to highlight the scale of the issue is an important starting point. We are calling for full disclosure from companies and DC pensions providers to publicly share their gender pension gap so that we can better identify and fix this problem.

“We are also making a call for regulators and law makers to look at reform; including dropping the minimum age of auto-enrolment, abolishing the auto-enrolment minimum salary threshold and provide further support to help families with childcare costs.”

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