- Women nearing retirement in Britain have median private pension savings of £81,000 compared with £156,000 for men.
- The Pensions Commission says career breaks, childcare responsibilities and part-time work are widening the gap.
- Britain has the second-largest gender pension gap among wealthy OECD countries, behind only Japan.
Women in Britain are approaching retirement with almost half the private pension savings of men, according to the revived Pensions Commission, which is expected to urge ministers to make closing the gender pension gap a central part of future pension reforms.
The commission’s interim report on the future of Britain’s retirement system, expected this week, is likely to warn that the gap in pension wealth risks pushing more women into financial insecurity later in life while adding pressure to public finances.
According to figures cited by the commission, women nearing retirement currently have median private pension savings of around £81,000, compared with £156,000 for men.
The findings come as policymakers increasingly worry that many younger workers across Britain are not saving enough for retirement, raising concerns that future pensioners could face lower living standards than current retirees.
The motherhood penalty shaping retirement savings
The commission said the pension gap goes beyond differences in pay and reflects deeper structural issues tied to women’s working lives.
Research commissioned from the Institute for Fiscal Studies found that women’s pension contributions often stall after childbirth, creating what researchers described as a “motherhood penalty”.
Before having their first child, women contributed roughly £30 a week into pensions on average, according to the data. Six years later, that figure remained largely unchanged.
For men, however, average pension contributions reportedly rose from about £30 a week to more than £60 a week over the same period.
Women are also more likely to reduce working hours, move into part-time employment or leave jobs altogether because of caring responsibilities. That can leave many excluded from automatic enrolment into workplace pension schemes or contributing less over time.
Lady Jeannie Drake, who leads the relaunched commission, reportedly said the current system had “not yet fully accounted for the realities of many women’s working lives”.
She added that career breaks, caring responsibilities and part-time work continued to shape retirement outcomes for many women across the country.
Pressure builds for wider pension reforms
The Organisation for Economic Co-operation and Development ranks Britain as having the second-largest gender pensions gap among wealthy member countries, behind only Japan, despite near-equal state pension outcomes for men and women reaching retirement age by 2026.
The commission is expected to argue that reducing the gap will require broader reforms beyond pensions policy alone, including childcare access, workplace flexibility and labour market changes.
The original Pensions Commission was established under former prime minister Tony Blair in 2002 and played a major role in shaping automatic workplace pension enrolment in Britain. It was revived by Prime Minister Keir Starmer last year amid growing concern over retirement savings and pensioner poverty.
The current panel includes Lady Drake, former Barclays UK chair Ian Cheshire and Nick Pearce, professor of public policy at the University of Bath.
The commission’s final recommendations on the long-term future of Britain’s pensions system are expected next year.
