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Moving from the Treasury, which reigns in spending, to the Department for Work and Pensions, which spends more than any other department, is...

Wednesday, 30 September 2015

WOMEN DO WORSE THAN MEN WITH NEW STATE PENSION

UPDATE 2 NOVEMBER 2015

THIS BLOGPOST HAS BEEN SUPERSEDED BY NEW STATE PENSION CONTINUES TO DISCRIMINATE AGAINST WOMEN.

DO NOT RELY ON THE DATA BELOW WHICH HAS BEEN SUPERSEDED BY NEW INFORMATION FROM THE DWP.

Only one in four women who qualify for the new state pension in 2016/17 will get the full amount, which will be at least £151.25 a week. New figures show that out of 80,000 women reaching state pension age in 2016/17 only 20,000 (25%) will get the full rate or more. But 60,000 - three out of four (75%) - will get a much reduced pension. In many cases it will be the same as they would have got under the old state pension scheme - which by then will be around £119 a week.

The figures for 2016/17 are better for men - but not much. Just over four out of ten - 41% - will get the full new state pension or more. The rest - nearly six out of ten - will get a much reduced pension similar to that paid under the old system.

The Department for Work and Pensions has resisted publishing a gender breakdown for the early years of the new pension. It took a Freedom of Information (FOI) request to get any figures. And they still did not reveal the proportion of women and of men expected to get less than the full amount. When I requested these figures I was told "These figures aren’t in the public domain, but you could FOI."

However, it then emerged that the gender breakdown of those reaching state pension age up to 2033/34 had been published in 2013 - by the DWP! Those figures are out of date but unlikely to have changed significantly. Combining the two sets of data showed that the discrimination against women would continue to 2033/34 at least when 21% would get less than the full pension compared with only 15% of men.

In the first five years of the scheme, 2016/17 to 2020/21, 680,000 women will reach state pension age but only 250,000 (37%) will get the full new State Pension and 430,000 - nearly two out of three (63%) - will get less . For men the figures are 1,280,000 reaching pension age and 610,000 (48%) who get the full new State Pension and just over half (670,000 or 52%) will get less than the full amount. There are fewer women reaching state pension age than men because over that period their state pension age is raised at an accelerated rate to equalise it with men's. 

The table shows the new State Pension year by year the number and percentage of men and women who will get less than the full amount.


These calculations are based on figures from the stated sources. The DWP says the 2013 estimates are out of date. But it will not provide updated ones so I have had to put in a Freedom of Information request. When I get the updated figures this table will be updated too.

People will get a reduced new state pension for two reasons.

First, in its early years the new state pension will be reduced for time 'contracted out' and paying into a private or company pension. For many people that will reduce the amount of the new state pension to less than they would have got under the old system. In those cases they will get the pension they would have got under the old system. Hence the large number who have no more than the old pension.

Second, the new state pension requires 35 years' National Insurance contributions to get a full pension. The old pension only needs 30 years. It will be harder for women than men to achieve this number.

14 October 2015
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