We’re all aware of the gender pensions gap. And understanding around the ethnicity gap is growing.

In 2022 women’s private pension income was 64 per cent of that of the average and ethnic minorities had 62 per cent that of the average, although Pakistani, Bangladeshi and Black groups are likely to have had much lower.

Covid-19 has exacerbated the inequalities experienced by vulnerable people – the gap for ethnic minorities has widened over the past few years.

So how are we to provide immediate relief to people with low pension incomes today, and those who are likely to experience these tomorrow?

Interventions are available, at a cost, for helping those in retirement – the government could increase means-tested benefit payments for the poorest pensioners.

Helping tomorrow’s pensioners may be more complex. Pension schemes report that some working-age people have stopped pension contributions because of costof-living rises.

It will be vital to ensure that those who could be underpensioned tomorrow are enabled to contribute today.

Requiring employers to contribute on behalf on lower income employees, who may not be able to afford it, is one possibility, though employers are likely to resist a move like this and so a negotiated settlement would be required.

Whatever the approach, some policy moves will be necessary if we are to prevent today’s labour market inequalities and economic pressures maintaining pension income gaps for women and ethnic minorities into the future.

Share Story: