Around 85 per cent of workers, equal to 16 million people, are not saving at levels likely to deliver an acceptable standard of living in retirement, new research has found, prompting calls for the development of a ‘Living Pension Standard’.

A report from the Living Wage Foundation and the Resolution Foundation raised concerns over the current levels of saving, explaining that while auto enrolment (AE) improved rates of saving, meeting the Living Pension benchmark requires more than the AE minimum.

The research, which excluded defined benefit (DB) pensions, found that low-paid workers are least likely to be saving at appropriate levels, with fewer than five per cent saving at a rate that would provide an adequate standard of living in retirement.

Gender differences were also highlighted, as the research revealed that 23 per cent of male workers met the ‘whole career’ Living Pension cash benchmark, compared to 15 per cent of female workers, primarily due to differing levels of pay rather than differing saving behaviour.

However, it revealed that this pattern was reversed when considering only low-paid workers, with 5 per cent of low-paid female workers meeting or exceeding the ‘whole career’ percentage Living Pension benchmark, compared to 3 per cent of low-paid male workers.

The report suggested that this is partly because low-paid women are concentrated in the public sector, where pension saving rates are relatively high, with 23 per cent of low-paid women work in the public sector, compared to 6 per cent of low-paid men.

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