Pension Gender Gap; let’s change unfairness – not inequality.

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Scottish Widows defines “The gender pension gap” as the difference between the average female and male’s savings for retirement.

That’s an insurer’s way of looking at pensions. I suspect that most people at retirement see retirement in terms of savings, inheritances, time to live, housing , family support and of course pensions!

Savings as a measure of “retire-ability”, isn’t  particularly inclusive, but it is at least easy to measure and probably a good proxy for wealth and poverty.

Scottish Widows reckon that the savings gap between men and women , starts when we’re girls and boys.

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And on International Women’s Day , they’ve got the issue trending on twitter. It’s good that it is  and well done Scottish Widows.

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If you go to the Scottish Widows “Your Future ” site, you can spend a morning browsing the various Vlogs and Blogs , there to help you engage. The site’s good, the content’s good and let’s hope that this issue gets the attention it deserves.

Pension gender inequality is natural

It is important we understand that men and women are not the same. Women live longer than men and have longer out of the workplace because mothers do children better than Dads. I don’t think we are going to change biological differences between the sexes, inequality is natural and so long as these differences are recognised, we can deal with them.

Pension gender unfairness isn’t natural

It is not fair to give boys more pocket money than girls, it isn’t natural either, it’s a bias that persists from a time – now long gone – when men supported women and women didn’t need financial self-sufficiency.  I wasn’t around that long ago and suspect that women were never properly supported. Looking at the way women get treated around the world – take toilets in India as an example – I suspect that left to our own devices, men will take advantage of women.

Which is why we have to work at the unfairness of paying women less than men for doing the same job just as well. It is simply not right to assume that the natural order of things makes  for women getting less by way of opportunity or pay.

The gender pension gap isn’t necessarily unfair

Until recently, women got their state pension earlier than men. This didn’t really make sense in a world where women were living longer than men and this has now stopped. The transition to a single state retirement age for men and women has been badly managed and has led to a lot of women not getting what they expected. The shift to a more natural state of affairs was carried out unfairly (which is WASPI’s complaint). Whether they get compensation is up to Government but the compensation must be for what is unfair not for making the unnatural – natural

Similarly, it is unfair that women are on the wrong end of 70% of the problem caused by the net pay anomaly. This is a by-product of an overly elaborate pension tax-system. It is natural that many women are low-earning and enrolled if they are only doing a few hours a week. But it is unfair if the work they do is at minimum wage (when equivalent work for men is paid more).

We shouldn’t confuse pension  unfairness with wider unfairnesses. However, if the gender pay gap narrows, the pension gender gap will narrow too

But where inequality is unfair we must take immediate action

The net-pay anomaly (for example) is unfair on 1.7m and needs to be sorted. 70% of those 1.7m are women. By sorting a wider inequality we help women more than men, this is a by-product of the fix but a happy one. With WASPI it worked the other way round.

Inequality I can live with – unfairness I can’t

I’d love to level up male longevity to women’s – but I can’t. I have to live with biological inequality.

But I can’t live with unfairness such as paying women less for the same thing or making women pay more for the same benefit (the net pay anomaly).

It’s not just me, it’s everyone who can see that men and women are different. Respecting the difference is part of men respecting women and vice versa.

Gender equality in annuities

I see Scottish Widows as proudly asserting the rights of women to be treated fairly, but sometimes that may mean women get treated differently.

I think there is a case for reviewing the case for unisex annuities where we ignore the fact that women live longer than men because of a European Law. If we decide to keep unisex annuities, we need to accept that it introduces a bias that favours women and that bias needs to be justified by it addressing an equal and opposite bias elsewhere in the system.

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The Gender Pension Gap starts with fundamental inequalities between men and women. It continues because we do not properly recognise these inequalities and use them to justify things which are unfair.

A male orientated system has thought that women would do what women have historically done – accept unfairness as part of inequality.

But that is changing. One of the songs I grew up with was “It’s obvious” by the Au-Pairs.

It had the chorus “we’re equal – we’re different”  – repeated several times.

The second question we should ask – after discovering where this gender pension gap starts, is whether the gap is natural or unfair. Only when we’ve defined that, can we ask the third and very proper question “when does it all end?”.

About henry tapper

Founder of the Pension PlayPen,, partner of Stella, father of Olly . I am the Pension Plowman
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