Pensions gender gap is narrowing, says survey

Image caption The gap between women's and men's pensions has narrowed

The gap between men's and women's pensions has narrowed in the past few years, according to a survey by the Prudential.

But the gap is closing because male incomes are falling, and not because women's are rising.

The Prudential says that taking into account all retirement income, women will have an average of £12,250 to live on compared with men's £18,000.

The gap has narrowed to £5,750, compared with £7,400 last year.

Pension incomes overall have been falling in recent years due in part to low interest rates and low stock market returns, as has the income offered by annuities, the policies pensioners buy that secure them a fixed income for the rest of their lives.

The average pension across both genders has fallen to £15,500 now, compared with £16,600 in 2011, said Prudential, which is itself a pension provider.

In 2010, average male pension incomes were higher at £19,600, with women retiring on around £12,200 a year, almost unchanged on the income expected this year.

Annuity incomes have fallen sharply in the past four years. A 65-year-old man with £100,000 pension pot can now buy an annuity paying an income of about £6,000 a year, 20% less than he would have received in 2008.

Malcolm McLean, consultant at actuarial firm Barnett Waddingham, said: "As we know from other surveys less than half the working age population of the UK is now contributing to any sort of private pension arrangement.

"All of this re-emphasises the need to reinvigorate the savings culture and restore public confidence in the system."

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