Pensioners will see their basic state pension rise by £2.40 a week next April following the publication of inflation figures later today.

Next year’s pension rise is based on the retail price index for September, which will be published by the Office of National Statistics today. Economists predict that the index will fall below last month’s figure of -1.3%, but the government has already guaranteed an increase in weekly pension payouts of no less than 2.5%. On this basis the state pension is likely to increase from £95.25 a week to £97.65. It follows an increase of 5 per cent a year earlier, up from £90.70.

Andrew Harrop, head of policy at the Age Concern and Help the Aged charity group said the rise was woefully inadequate. “Although the commitment to raise the basic state pension by at least 2.5 per cent will be a relief for older people, a £97.65-a-week pension is still not enough to ensure a decent standard of living to people who have worked hard all their lives.

“The pension system needs urgent reform to ensure older people can live off their pensions without having to apply for benefits.”

A separate report by insurer Scottish Widows reveals that the pensions gap between men and women has widened in the past year, despite an increase in the number of women savers putting away adequate provision for their retirement.

The report suggests that 47% of women are saving adequately for retirement compared with 59% of men. Last year 46% of women were reported to have put 12% of their income towards their pensions - thought to be enough to provide a comfortable retirement - and 55% of men.

The gap between the amount saved by men and women was also found to be substantial. While women who contribute to a private pension scheme pay in an average of £184 a month, men contribute £331.

“There is a long way to go before women catch up with men when it comes to pensions savings but the issues of taking time out to have children and interrupted working patterns are never going to change,” said Ian Naismith, head of pensions market development at Scottish Widows.

“While it is encouraging that younger women accept that the state will not provide them with enough to fund their retirement, there is still more that women can do to save for their futures.”

This entry was posted on Tuesday, October 13th, 2009 at 11:01 am and is filed under Retirement, Savings. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.