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* Department for Work & Pensions Official Statistics BACKGROUND INFORMATION AND METHODOLOGY: GENDER PENSIONS GAP IN PRIVATE PENSIONS Published 5 June 2023 APPLIES TO ENGLAND, SCOTLAND

AND WALES CONTENTS * Context of the statistics * Purpose of the statistics * Source of the statistics * Limitations of the statistics * Comparison between the statistics * Definitions and

terminology within the statistics * About the statistical techniques * Status of the statistics * Feedback * Useful links Print this page © Crown copyright 2023 This publication is licensed

under the terms of the Open Government Licence v3.0 except where otherwise stated. To view this licence, visit nationalarchives.gov.uk/doc/open-government-licence/version/3 or write to the

Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: [email protected]. Where we have identified any third party copyright information you will need to

obtain permission from the copyright holders concerned. This publication is available at

https://www.gov.uk/government/statistics/gender-pensions-gap-in-private-pensions/background-information-and-methodology-gender-pensions-gap-in-private-pensions CONTEXT OF THE STATISTICS A

priority for the Department for Work and Pensions is to improve people’s quality of life, by addressing poverty through increased financial resilience. Automatic Enrolment (AE) and the new

State Pension have been instrumental in increasing financial resilience in later life. These policies have addressed inequalities in pension provision, especially with regards to gender

differences. However, private pension wealth is not equally distributed between the genders. Women have less private pension wealth on average, compared to men. This publication defines,

estimates, and contextualises the Gender Pensions Gap (GPeG) in Great Britain to support efforts towards closing the gap. Find out more information on Automatic Enrolment, Workplace Pensions

and State Pension. PURPOSE OF THE STATISTICS The aim of this publication is to provide a definition and estimation of the Gender Pensions Gap, as well as to provide context to understand

this complex issue. This publication compliments releases by the Office for National Statistics and the Department for Work and Pensions on pension wealth and pension participation and

savings trends. These statistics: * inform about the current and past size of the Gender Pensions Gap among those who hold uncrystallised private pension wealth in Great Britain * support

conversations around the Gender Pensions Gap by providing a definition, estimation, and context These statistics do not: * inform about the size of the Gender Pensions Gap among everyone

(regardless of availability of private pension wealth) in Great Britain * consider the Gender Pensions Gap across the entire pensions system as it does not consider State Pension and

supporting pensioner benefits * estimate the complete pension wealth of the population as it also excludes other financial assets and properties. These can, but might not necessarily, be

used as a source of income in retirement SOURCE OF THE STATISTICS This release draws on 2 different data sources: * the Wealth and Assets Survey (WAS) * the Annual Survey of Hours and

Earnings (ASHE) THE WEALTH AND ASSETS SURVEY (WAS) The Wealth and Assets Survey (WAS), a biennial longitudinal survey of Great Britain conducted by the Office for National Statistics (ONS),

covering sources of wealth, including but not limited to Private Pensions. This survey, in the latest round between 2018 and 2020 (7), included 17,500 households. WAS has been chosen as a

reliable, national statistic which enables monitoring of changes in pension wealth due to its longitudinal character. Read the background information on this data source in the WAS Quality

and Methodology Information. ANNUAL SURVEY OF HOURS AND EARNINGS (ASHE) The Annual Survey of Hours and Earnings (ASHE) is conducted by the Office for National Statistics (ONS) and is a key

source of information on workplace pensions in GB as it collects information on all types of workplace pension: occupational pension schemes, group personal pensions and group stakeholder

pensions. The survey results are used widely in order to analyse pension participation and to monitor the impacts of pension reforms. Read the background information on this data source in

the Annual Survey of Hours and Earnings (ASHE) methodology and guidance. LIMITATIONS OF THE STATISTICS DATA SOURCES Wealth and Assets Survey (WAS): * WAS is a longitudinal survey and

measures assets, debt, and savings. It also covers attitudes to savings and indebtedness * the ONS provides more information on WAS here Quality and Methodology Information * non-sampling

errors may occur in a sample survey or a census. The main sources of non-sampling error are: * response errors resulting from misleading questions, interviewer bias or respondent

misreporting * bias resulting from non-response, as the characteristics of non-responding persons may differ from responding persons * data input errors or systematic mistakes in processing

the data * a sampling error refers to the difference between the results obtained from the sample and the results that would be obtained if the entire population was fully enumerated * in

April 2016, the periodicity moved to align with the financial year to be integrated more easily with other surveys. The analysis has taken necessary steps to ensure consistency of the

measures between waves and rounds * the impact of the pandemic on the overall response rate was minimal Annual Survey of Hours and Earnings (ASHE): * ASHE is based on a 1 per cent sample of

employee jobs taken from HMRC PAYE records. Information is obtained from employers and treated confidentially. ASHE does not cover the self-employed nor does it cover employees not paid

during the reference period * the 2021 ASHE data has a reference date of the week containing 21st April 2021 * ASHE collects information on employee membership of the current employer’s

workplace pension scheme. This does not include preserved rights in any former employer’s pension scheme or pensions paid by former employers * ASHE collects information from employers on

employee jobs, although they are referred to in this Official Statistic as ‘employees’ * the overall level of uncertainty arising from the sample size of ASHE is low, however uncertainty may

be higher for particular subgroups * for further information on ASHE please see the Background notes section on the ONS website * prior to the coronavirus (COVID-19) pandemic, the achieved

sample size for ASHE was approximately 180,000 each year. However, given the challenges to data collection during the coronavirus pandemic and response rates not recovering, the final

achieved sample size was 144,000 for 2020 and 140,000 for 2021. As such, ASHE estimates for 2020 and 2021 are subject to more uncertainty than usual EXCLUSIONS FROM THESE STATISTICS The

following groups are excluded from the estimation of the Gender Pensions Gap determined from the Wealth and Assets Survey: * those aged below 16 * those between the age 16 and 18 in

full-time education * those who have fully crystallised their pension wealth * those who hold no private pension wealth COMPARISON BETWEEN THE STATISTICS The Office for National Statistics

releases information on pension wealth in Great Britain using the Wealth and Assets Survey. Read the latest release of Saving for retirement in Great Britain – Office for National

Statistics. The Department for Work and Pensions releases information on participation and contribution rates to workplace pensions in Great Britain. Read the latest release of Workplace

pension participation and savings trends of eligible employees: 2009 to 2021. DEFINITIONS AND TERMINOLOGY WITHIN THE STATISTICS The Gender Pensions Gap in this publication is defined as: *

the percentage difference in uncrystallised non-zero median private pension wealth between men and women around the normal minimum pension age UNCRYSTALLISED PENSION WEALTH Uncrystallised

pension wealth is pension wealth not in payment, for example, active or preserved. NON-ZERO PRIVATE PENSION WEALTH This publication only considers those who hold some private pension wealth,

for example, non-zero private pension wealth. The largest group of people without any private pension wealth are those who are economically inactive, including: students, those looking

after the family/home, those temporarily sick or injured, those long-term sick or disabled, those retired, those with other reasons. These individuals are not in a comparable position to

accrue private pension wealth. This approach is in line with other statistics relevant for public policy. For example, unemployment statistics exclude those who are economically inactive and

are therefore not seeking work. Besides economic inactivity, full-time education is another example of why an individual might not hold any private pension wealth. MEDIAN The median is the

value splitting a distribution leaving half the cases below and half above the median value. The median is used for distributions that are heavily skewed, such as income or wealth, to avoid

very low/high numbers having a large impact on the measure. NORMAL MINIMUM PENSION AGE Normal minimum pension age is the earliest age at which one can access their pension. When introduced

in 2006 it was set at age 50, in 2010 it increased to age 55. When this publication refers to the GPeG around normal minimum pension age the age band 55-59 is used for Rounds 6 and 7 and

Waves 3, 4, and 5. The age band 50-54 is used for Waves 1 and 2. These five-year bands are chosen to ensure a balance between granularity and a sufficiently large enough sample size in WAS.

PENSION WEALTH Pension wealth reflects the outcome of pension accumulation at a given age band. Considering pension wealth means that we are estimating the Gender Pensions Gap based on

available wealth, not on the income drawn down as pension income. AUTOMATIC ENROLMENT (AE) Automatic Enrolment (AE) was introduced in 2012 to help address the decline in private pension

saving and to make long-term saving the norm. AE mandates employers to provide a workplace pension for all workers meeting all of the following criteria: * working in the UK; earning more

than the earnings threshold (currently £10,000 a year) * are aged between 22 years and State Pension age (SPa) * are not already enrolled in a qualifying workplace pension The analysis

includes employees already a member of a workplace pension scheme when AE was introduced. ABOUT THE STATISTICAL TECHNIQUES VARIABLES When estimating uncrystallised private pension wealth, in

line with ONS estimations, this analysis considers: * total value of defined benefit occupational scheme * total value of current defined contribution pension wealth * total value of

additional voluntary contribution (AVC) schemes * total value of personal pension scheme * total value of retained rights in Defined Benefit (DB) scheme. In Round 7 of WAS, it is possible to

distinguish between retained rights in DB schemes that have been partially accessed while leaving some uncrystallised wealth and retained rights in DB schemes that have not been accessed at

all. This analysis includes both, which is consistent with the full value of retained rights in DB schemes used in previous rounds and waves of WAS * total value of retained rights in

Defined Contribution (DC) scheme. In Round 7 of WAS, it is possible to distinguish between retained rights in DC schemes that have been partially accessed while leaving some uncrystallised

wealth and retained rights in DC schemes that have not been accessed at all. This analysis includes both, which is consistent with the full value of retained rights in DC schemes used in

previous rounds and waves of WAS Throughout, when available, imputed variables are used for improved accuracy. When assessing AE eligibility, this analysis considers respondents’ individual

responses at the time of interview. Whether the AE eligible respondents are in fact enrolled in their workplace pension scheme is not being considered. As AE eligible defined are respondents

who: * are employees (e.g., not self-employed) * have an annual gross pay higher than the earnings trigger at the time * are aged being between 22 and the relevant State Pension age The

3-month average year-on-year percentage change in Average Weekly Earnings (AWE) taken in September of each year is used to deflate the trigger value to estimate the earnings trigger

pre-2012. WEIGHTING This analysis uses the respective wave/round household weight in line with ONS methodology. ROUNDING This analysis reports figures rounded to the nearest £1,000 and

percentage point. REVISIONS TO THE STATISTICS DWP are reviewing these statistics as part of the department’s ongoing statistical work programme. DWP is committed to regular reporting of

these statistics and will seek views on the appropriate frequency with which to publish revisions as new data becomes available. STATUS OF THE STATISTICS OFFICIAL STATISTICS This release is

classed as official statistics, according to the Code of Practice. This means that this release applies the three pillars as defined in the code: * trustworthiness * quality * value QUALITY

STATEMENT All data sources used in this publication have undergone detailed quality assurance processes. DWP analysts have quality assured the analysis and presentation of the findings in

this publication. The ONS has their own measures in place to assure the quality of WAS and ASHE data. In addition, we monitor any developments regarding the pension variables within these

surveys. FEEDBACK WE WELCOME FEEDBACK We are committed to improving the statistics we publish and would welcome any views you have. Contact us for statistical enquiries and publication

feedback only, email: [email protected] Press enquiries should be directed to the DWP Press Office, telephone: 0203 267 5144 USEFUL LINKS ONS publication: Saving for

retirement in Great Britain DWP publication: Workplace pension participation and savings trends of eligible employees: 2009 to 2021 Back to top