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A new report from the Social Market Foundation calls on the Government to pay into women’s pension pots to avoid the gender earnings gap becoming wider in retirement due to the impact of career breaks.
The Government should pay into the personal pensions of women who take time out of work to care for children or elderly relatives, according a report by think tank the Social Market Foundation.
The think tank says that, without significant new support for women’s pensions, increasing lifespans will widen economic gaps between the sexes and see women’s wealth falling further behind men.
Its “Gender equality and the 100-year life” report says people still tend to expect women to bear most of the burden of looking after children and elderly relatives. For instance, 27% would expect a brother to care for elderly family, but 34% say a sister should do so.
To stop the earnings gap widening as a result of care breaks, the Government should consider paying into the pension pots of women who take time out of work to care, says the report.
It states that in 2016, the ONS estimated that a woman on maternity leave carries out weekly unpaid work with an economic value of £762.75, well above the average regular weekly wage. Applying the current 3% minimum contribution rates from automatic enrolment pensions schemes to such a value would mean a new Government contribution of £22.88 per week, or £1189.89 per year, to that woman’s pension pot.
The research also shows: