While the gender gap in state pensions is "almost closed" for new retirees, it continues to widen in the private sector

According to the Department of Work and Pensions, the state pension amounts for men and women are expected to "be equal very shortly"

The state pensions of those retiring today show that the gender pension gap has been virtually eliminated, according to new data.

According to the Department of Work and Pensions' (DWP) response to a Freedom of Information request submitted by former pensions minister Steve Webb, "the amounts of new state pension for men and women are on course to be equal very shortly."

The difference between what men and women receive from the new state pension has decreased to less than 1 percent for the most recent subset of retirees for which statistics are available (those who will reach state pension age in November 2024).

The FOI reports that the average newly retired man currently receives a pension of 209.95 per week, while the average newly retired woman receives 208.15, which is 1% less than her male counterpart.

In a different article, we examine the amount of the state pension you will receive.

It is anticipated that this disparity will narrow even more as the new state pension system implemented in 2016 takes effect, and it may eventually cause women to surpass men by a small margin. With the triple lock, both groups gain.

"These figures show that things can be changed provided that there is political will to do so," said Webb, a partner at pension consultancy LCP and the former pensions minister who designed the new state pension system.

Yet, "far too many women who have already retired are living on reduced pensions, and I will continue to campaign for their fair treatment, including by identifying all of the mistakes that have resulted in so many of them being underpaid for so long."

Gender gap in state pensions.

The typical pensions paid to men and women have differed significantly since the late 1940s, when the state pension was instituted.

Even now, the average state pension that men and women who retired under the previous state pension system receive is significantly different; men receive an average of 217.30, while women receive an average of 186.44.

As a result, the average woman only receives 86% of the pension that a man receives.

These figures also fail to acknowledge that many of the women currently receiving respectable state pensions are widows who were previously on a lower figure for many years and whose pension only increased after their husband passed away.

To gradually close the gender pension gap, however, was one of the specific objectives of the 2016 introduction of a new state pension system.

In order to preserve the rights that people had already accrued under the previous system, the new system had to be implemented gradually. However, those temporary safeguards are slowly being removed from the system, which means that the gender gap is closing annually.

Gender gap in private pensions.

It is encouraging that the gender gap in state pensions is closing, but private pensions are a different story. The outlook for women's retirement outcomes is dire, according to the government's second report on the gender pension gap.

It reveals that the gender pension gap has widened by 13 percentage points over the past two years, marking a significant shift in the wrong direction. This is based on the fact that men and women between the ages of 55 and 59 have different private pension pot sizes.

The gender pension gap has increased from 35 percent two years ago to a staggering 48 percent, according to the most recent official data.

According to the report, women between the ages of 55 and 59 can anticipate having an average pension pot of 81,000 by the time they are 60, which translates into an estimated 6,000 per year in retirement income. In the meantime, men will typically have a pension fund of 156,000, which translates to an estimated 11,000 per year.

The fact that women typically receive slightly more than half of men's pension income makes the reality of pension saving inequality very real, according to Kate Smith, head of pensions at Aegon. This is made worse by the fact that women typically outlive men, which means they should save more rather than less.

Smith stated that women's retirement outcomes seem to be disproportionately impacted more than men's, and that the shift from defined benefit to defined contribution pension provisions appears to be linked to the gender pension gap's widening.

Given that most people's pensions will be defined contribution plans, it is extremely alarming that women between the ages of 55 and 59 who only have defined contribution savings wealth have the largest gender pension gap, at 75%.

"And for those who only own defined benefit wealtha type of pension arrangement that is drastically declining in the private sectorthe smallest gender pension gap at the same age is 39%.

The future of women's pension equality is not bright unless drastic measures are taken to address labor market disparities, cultural norms, and the gender pay gap.

The resurrected Pension Commission's mandate includes addressing pension inequality and thinking about the future of the UK pension system.