Civil service unions Prospect and the FDA have called on ministers to take action to reduce the “gender pension gap” faced by departmental officials, which they describe as “unacceptably high”.
Earlier this year, Prospect calculated that in 2022-23 there was a 36.5% difference between the average total pension income received by female recipients of the state pension compared with male counterparts across the UK.
It said that the civil service pension gap, as measured by data underpinning 2020’s actuarial valuation of the CSPS, was 45%. The figure represents the difference in average gross pension income received by female retired civil servants compared with male counterparts.
This week, Prospect deputy general secretary Steve Thomas and FDA assistant general secretary Adrian Prandle wrote to the Cabinet Office seeking “urgent” steps to address the issue in the CSPS’s main Alpha Scheme.
The Cabinet Office is responsible for managing the CSPS, while HM Treasury is responsible for public sector pension scheme policy.
Thomas and Prandle argue that the impact of caring responsibilities on female civil servants will continue to drive the pension gap in the sector unless CSPS rules are changed to better reflect the needs of people with such obligations.
In a letter to newly-appointed minister of state Anna Turley, they say reforms proposed for the Local Government Pension Scheme show how disparity in the CSPS could be greatly reduced in an “effective and affordable” way.
Among the measures highlighted are making authorised unpaid absences of 31 days or fewer automatically pensionable and making unpaid statutory parental leave pensionable. Additionally, Prospect and the FDA are calling for mandatory reporting on the civil service pension gap.
The LGPS reform proposals came out of a report commissioned from the Government Actuary’s Department that was published in 2023.
Prospect and the FDA have asked the Cabinet Office to commission the GAD to produce a tailored report on the civil service pension gap and ways it can be reduced.
‘Significant level of inequality’
Thomas and Prandle said Turley would be aware of the need to tackle the “significant level of inequality” in the Alpha Scheme – and that that the Equality Act 2010 required her to have “due regard to the need to eliminate it”.
“We recognise that several policies, particularly around the gender pay gap, shared parental leave and childcare, will help reduce the gender pension gap in the scheme over time,” they wrote.
“However, the impact of caring responsibilities on the pension accrued by women will continue to drive an unacceptably large gender gap unless addressed in the scheme rules.
“If the rules of the Alpha Scheme better reflected the working lives of women (and also some men) with caring responsibilities, this would greatly reduce the disparity in outcomes.”
Thomas and Prandle said that a cost estimate of the LGPS reform proposals for England and Wales suggested an annual figure of under £1m in increased contributions.
They said the cost to civil service employers would be “of the same order of magnitude” and would be “clearly also affordable” for the Alpha Scheme.
Thomas and Prandle acknowledged that other reforms proposed for the LGPS – which, unlike the CSPS, is a funded pension scheme – might be “less straightforward” to incorporate into regulations for the Alpha Scheme.
One example was making it easier for scheme members with an unpaid work break of more than 30 days to buy back any pension lost during that time.
Nevertheless, they said it was important for the GAD to identify the main causes of the civil service’s gender pension gap and for “all practical proposals that would help close it to be assessed”.
It is not the first time that Prospect and the FDA have called on government to act on the civil service pension gap.
In spring last year, Prospect asked then-chief secretary to the Treasury Laura Trott to instigate action after “numerous” previous approaches failed to get the department to engage in a “meaningful way”.
Prospect and the FDA’s decision to lobby the Cabinet Office on the pensions gender gap appears to be a change of tack.
More than 3,150 people have now signed an online petition launched by Prospect over the summer that calls for action to end the public sector pension gap.
A Cabinet Office spokesperson said: "The Cabinet Office welcomes opportunities to consider issues of fairness within the Civil Service Pension Scheme appropriately where they arise, and looks forward to engaging Prospect and the FDA on this important issue."