Divorcing wives ‘must have rights to pension pots’

Age UK demands change in the law to ensure full disclosure of private schemes in all settlements

Women going through a divorce should be given the right to see the size of their husband’s pension pot, Age UK has argued. The charity says thousands of women are being left worse off in retirement because they are not made aware of their legal entitlement to their husband’s private pension as part of the divorce process.

WOMEN going through a divorce should be given the right to see the size of their husband’s pension pot, Age UK has argued.

According to the charity, thousands of divorced women are being left worse off in retirement because they are not made aware of their legal entitlement to their husband’s private pension as part of the divorce process.

At present for divorcing couples who settle their finances out of court there is no automatic right to know their spouse’s pension value or requirement that pensions must be split as part of the settlement.

According to research by Scottish Widows, seven out of 10 couples do not discuss their pensions at all before divorce, meaning that many women may miss out on substantial sums without realising.

To stop them being shortchanged Age UK is calling for the Government to change the law so that private pensions must be considered as part of the divorce process and, wherever possible, divided fairly between spouses.

According to official data from the Office for National Statistics, men approaching retirement aged 55 to 64 have median pension wealth of £125,000, about three times as much as women of the same age, who have median pension wealth of £42,300.

As many as one in three women currently aged between 55 and 70 years have experienced divorce.

Caroline Abrahams, Age UK’S director, said: “It is extraordinary and frankly unacceptable that so many women are potentially missing out on significant sums of money when they divorce, sometimes without even realising they have lost future income which probably should have been theirs. The Government must act quickly to make consideration of private pension wealth a proper part of the divorce process.

“If we are serious about gender equality in our society it’s high time this changed.

“It is crucial that women are helped to build up a decent private pension, get the right information and advice at the right time, and as a matter of law

‘If we are serious about gender equality in our society it’s high time this changed’

and practice have fair and equal access to the private pension wealth they have built up with their husbands if they are divorced or bereaved later in life.”

The report by Age UK raised concerns about older women’s pension prospects. It pointed out that unlike in the old state pension system, women retiring on the new state pension (from April 2016) do not have provisions to claim based on their spouse or civil partner’s contributions.

This could cause particular difficulties for women approaching state pension age who have not built up their own full contribution record, and had expected to be able to claim on their husband’s record in the event of bereavement, it said.

It also warned that the Government’s pension freedom rules could leave women worse off than men because they are likely to live longer but have a smaller pension to use, meaning they would have to be even more careful to make their money last until they die.