How Labour Is Changing UK Pensions: Women Set to Benefit From New Measures
The UK Labour government is introducing a number of pension reforms aimed at improving retirement outcomes and addressing long-standing inequalities in pension saving. Some of the measures particularly affect women, who are more likely to have interrupted careers because of caring responsibilities.
Women Set to Benefit From Pension Reforms
One important reform concerns unpaid maternity, shared parental and adoption leave in the Local Government Pension Scheme (LGPS). Under measures coming into force in 2026, qualifying periods of unpaid leave will become automatically pensionable.
The government says this could improve pension outcomes for millions of people working in local government, around three-quarters of whom are women. Maternity and career breaks have historically contributed to differences between men's and women's pension savings.
The reforms also include measures to improve the collection and reporting of gender pension-gap information.
Almost One Million Women Could Receive Pension Tax-Relief Payments
Another development expected to benefit a large number of women concerns missed pension tax relief.
HM Revenue & Customs is contacting around 1.32 million people who may have missed tax relief because of the way their workplace pension scheme operated. About 75% of those expected to benefit are women, according to reports.
The average payment is expected to be around £70, although the amount will vary between individuals. The issue mainly affects lower-paid workers enrolled in certain workplace pension schemes.
State Pension to Rise in April 2027
The wider UK State Pension is also expected to increase from April 2027 under the government's triple-lock system.
The triple lock means the State Pension rises each year by whichever is highest among inflation, average earnings growth or 2.5%. Recent wage-growth figures indicate that the 2027 increase is likely to be determined by earnings growth.
Current projections based on the latest earnings figures indicate that the full new State Pension could rise from around £241.30 per week to approximately £250.70 per week from April 2027. The exact confirmed rate will be announced through the government's annual process.
Why Women Are a Major Focus
Women can face lower retirement incomes because of several factors, including periods away from paid employment, part-time work and caring responsibilities. These can reduce workplace pension contributions and the number of qualifying years built up through employment.
The Labour government's reforms are therefore aimed not only at increasing pension payments generally but also at addressing some of the structural reasons behind the gender pension gap.
What Pensioners Need to Know
The changes do not mean that every woman in the UK will automatically receive a higher State Pension next year. The amount someone receives depends on their circumstances, including their National Insurance record and the type of pension scheme they belong to.
The reforms affecting unpaid leave are particularly relevant to eligible members of the Local Government Pension Scheme, while the tax-relief correction applies to specific workplace-pension arrangements.
Meanwhile, the annual State Pension increase applies more broadly under the existing triple-lock system.
A Changing UK Pension System
The government's pension agenda combines increases to State Pension rates with reforms to workplace pensions and measures intended to address the gender pension gap.
For women who have experienced career breaks because of maternity leave, adoption or caring responsibilities, changes to pension rules could make a meaningful difference to retirement savings over time. However, the precise benefit will depend on each person's employment history and pension arrangements.
As the UK moves toward 2027, pensions are likely to remain an important issue, particularly as the government considers how to balance higher retirement incomes with the long-term cost of the State Pension system.