Laura Donohoe: Bringing women’s state pension age into line with men’s ignores reality
The BackTo60 campaign group has lost a significant case against the government regarding its decision to raise the state pension age of women.
The High Court disagreed with the campaigners that the pension changes discriminated against women. Instead the court took the view that the changes were made to correct direct discrimination against men and so could be justified. The campaign group has lodged an application for permission to appeal the decision.
The case arose from the government’s decision to raise the state pension age for women to 65, in line with the state pension age for men. Initially the plan was to phase this in between 2010 and 2020, when the state pension age would rise to 66 for both men and women. However, the government decided to accelerate this plan and by 2018 the new qualifying age of 65 was in place for women.
Millions of women who were born in the 1950s have been affected by this change. Many of them have had their state pension put back by up to six years and are retiring with no access to state pension and, in some circumstances, very little money saved to support their life in retirement. The campaign group argued that the government did not give women enough time to prepare for the changes.
The court held that there was no discrimination on the grounds of age or sex against women. It also found that the steps taken to inform women of the state pension age increase were not inadequate.
Any movement towards rebalancing gender discrimination should be commended, and it is clear that (along with making the financial savings) the government was keen to address the state pension age difference between men and women.
However, in addressing this form of male discrimination, the government does not appear to have taken account of the impact of other factors which have historically led to discrimination against females. For example, women in the age category affected by the changes often had few opportunities to provide for their retirement in other ways. The salary gap between men and women, which is still prevalent today, saw women earn less money and consequently save less money into their pension than men. Additionally, women generally took more time out of work than men to care for children. Notably, even those women who did return to work on a part-time basis often found themselves excluded from pension schemes due to historic pension scheme rules.
These circumstances were discriminatory towards women and impacted pension saving. Bringing the state pension age for women in line with that for men fails to recognise the social reality of many women born in the 1950s and the lack of opportunities available to allow them to contribute to their pension. Now, as a result, we are faced with a growing gender pension gap.
Placing the discrimination point to one side, this case also highlights once again the importance of preparing for retirement at an early age and recognising that state pension provision can change. It also puts responsibility for that preparation firmly on the individual. Yet a recent survey found that 43 per cent of employees over the age of 45 are not aware of the state pension provision. The state pension age is continuing to rise. Without a more successful means of engaging and informing individuals on pensions, the problems faced by 1950s women are likely to be faced by many more. Much is riding on the long- promised pensions dashboard.
Laura Donohoe is a solicitor at Burness Paull LLP