Pensions savings have increased since last year, with an increase in those saving of eight per cent since 2006, says Scottish Widows.

The fifth annual Scottish Widows UK Pensions Report shows that the gender gap is widening, however, with 59 per cent of men saving adequately for their retirement compared to just 47 per cent of women. Women over 50 have been the hardest hit according to the survey, with a fall from 57 per cent in 2008 to 52 per cent this year in the Scottish Widows Pensions Index. The Scottish Widows Pensions Index stands at 54 per cent this year, up from 51 per cent in 2008.

Those over 50 were found to be the most likely to cut their savings, and 21 per cent saved less in the past year than they did last year, and 35 per cent of over 55s believe the economic downturn has impacted their retirement savings.

“We have seen our Index and Ratio figures rise considerably once again this year so the message that people need to improve their pensions savings is certainly getting through,” commented Ian Naismith, head of pensions market development at Scottish Widows. “The rise in those saving adequately cannot be solely attributed to pensions savings. Non-pensions savings has continued to rise, but total investments held have continued to fall suggesting that people are putting aside more but also withdrawing from their savings in the short-term.”

The report also shows an 11 per cent fall in confidence that a company pension scheme will provide a reasonable standard of living in retirement, to just 40 per cent.

“In addition to this, contributions to employer-sponsored Defined Contribution (DC) schemes have increased, especially amongst higher earners. With mane employers closing defined Benefit (DB) schemes, they may be contributing more than the average to DC schemes. But there is still more that needs to be done from both the Government and the industry to better encourage pensions savings for the long-term, particularly in the current economic environment. With 19 per cent of those that should be saving putting aside nothing at all there is still a big challenge ahead.”

- Pensions Age June 2009