Tackling pensioner poverty.

“Over recent years it has been established that the population of many industrialised countries, including the UK, are living longer. By 2056 the number of people over the age of 65 in the UK is expected to increase by 9% of the total population. Projections from the UK Office of National Statistics, for example, show that the number of people in the UK who are 65 years and older is projected to grow from 9.8m in 2007 to 12.1m by 2017. So the proportion of those in work versus those in retirement will change drastically over the next few decades.”

Joseph Lu
Mortality Risk Actuary, Legal & General Protection & Annuities


Legal & General pays over £1bn in annuity pension income each year, to over 600,000 customers who have put their trust in us to provide them with an income for life.

  • Our customers typically have pension savings pots of between £25k to £30k to buy their annuities with. Our monthly Money Moods survey showed that in 2010 the recession put severe pressure on the amount of pension savings people are able to make, as disposable income reduces.
  • Our 2011 Money Money Money programme, which worked with Year 10 pupils in schools, showed that 32% of young people hope their grandparents or parents would give them money. This potentially puts a strain on pensioners who are typically on fixed incomes.
  • Our market segmentation work shows that lower income groups in retirement represent 27.2% of the population. Legal & General’s customer base is made up of 16.7% of these clients so we have work to do to close the gap and make sure that retirement is comfortable for many more people in the UK.


We continue to focus on:

  • our products and services for existing pension schemes to aim to reduce the burden on the state and the numbers of pensioners already in poverty.
  • bringing in experts on issues that affect vulnerable elderly people to help us serve these customers
  • continuing to work with organisations to help us understand emerging trends
  • continuing to work with policy makers and government to identify the best ways to encourage more people to save for their retirement, and for access to pensions to be as inclusive as possible.


As working practice has changed and people have more employers throughout their career, there isn’t always the opportunity to make regular pension savings, which reduces the size of pension pots.

Although people have to work longer before retiring – the state retirement age will increase to 66 for both men and women by 2020 – they are also living longer in their retirement. Nearly one in five people in the UK will live to see their 100th birthday according to figures from the Department of Work and Pensions (DWP). They need to make sure their income in retirement is available throughout their lives.

2011 has been a year where pensions have come under pressure from government, both on pension fund charges and the European Union regulation on Gender Equality when pricing financial products.

Read more on pension cap charges

Read more on annuity reforms


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