Introduction

The UK pension system has been characterised by an abundance of changes since the Basic State Pension (BSP) scheme was introduced following the Second World War. Successive governments have essentially built upon the Beveridge blueprint in the context of social and economic change. However, a rather piecemeal approach to pension reform has led to the development of an extremely complicated pension system which creates uncertainty regarding the pension people can expect to receive in retirement. This complexity is compounded by a long-term decline in the relative value of the BSP, an increasing reliance on meanstested benefits and a patchwork of add-ons (DWP, 2013a). Changes in relation to private pensions, including forms of tax relief, contracting-out mechanisms and further regulation have added to this complex picture. This complexity has acted as a deterrent to pension saving, making it difficult for people to engage with decisions about their saving (Foster, 2012; Crawford et al, 2013). Ultimately these changes have also failed to eradicate concerns about the future sustainability of pensions systems and their ability to provide sufficient resources to remove the risk of poverty in retirement and also incentivise pension saving. Overall, it has been estimated that in the UK there are approximately 11 million workingage individuals who face inadequate retirement incomes, as compared to the level they expect to receive, with under-saving a common theme (Foster, 2012; DWP, 2013a). Concerns about the adequacy of people’s saving are exacerbated by increasing levels of longevity, which have seen male life expectancy at birth rise from 71.7 years in 1985 to 78.5 years in 2010, and female life expectancy at birth from 77.4 years in 1985 to 82.4 years in 2010 (ONS, 2011).

In practice, the Coalition government continues to face similar challenges to its predecessors: ensuring that government pension spending remains stable (this is particularly difficult during periods of high unemployment, lower growth, increasing national debt and financial market volatility) while reducing pensioner poverty, where women are over-represented (Foster, 2011). Gender differences in levels of saving reflect the fact that women are more likely to undertake caring responsibilities which lead to interrupted work histories and to be employed on a part-time basis, in lower-paid jobs (Ginn, 2003; Price, 2007). As a proportion of men's median full-time hourly pay, women full-timers receive 81% and part-timers only 52% (Pike, 2011).