Pension protection for minority ethnic groups in Britain: determinants, prospects and policy implications

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According to the 2001 Census, persons from Black and Minority Ethnic (BME) groups comprised about 10% of the total UK population, and more recent analysis of the Understanding Society dataset shows that about 14% of the UK's define themselves as belonging to a minority ethnic group. Although the age structure of the BME population is relatively young and only 4% of the total UK population aged 50 and over belong to BME groups, projections show an increasing share of BME older people in an increasingly diverse and ageing UK population. Socio-economic and health differentials between the BME population and the White majority, and between different BME groups, have been well-evidenced in the literature and reflect a disadvantageous position across the life course and in later life. For example, Pakistani, Bangladeshi and Indian persons aged 50 and over are more likely to report a limiting long-standing illness than their White counterparts, while the Pakistani and Bangladeshi groups are more likely than any other ethnic minority group to be at the bottom quintile of the income distribution. In terms of employment, about one-third of Bangladeshi and Pakistani men aged 25-64 are unemployed, and the proportion among women in the equivalent ethnic and age group is more than 80%. Such differentials in employment patterns contribute to low pension coverage among BME groups, particularly in terms of occupational and private pension schemes which research has shown to make a difference in an individual's likelihood of experiencing a poverty risk in later life. This context raises important policy-relevant questions about the wellbeing of older people from BME groups, and about the prospects of pension protection among future cohorts of BME persons. Much of the previous literature in this area is from the 1990s and early 2000s. Over the past decade, there has been a new wave of migration from Eastern Europe that has added a further layer of complexity to the BME population. Estimates from ONS highlight that around 6% of the population aged 25-44 in England and Wales are defined as non-British 'White'. Moreover, many of those aged under 45 from the Asian and Black ethnic populations are 'second generation', having been born in the UK. Furthermore, changes in pensions policy over the past decade have transformed the pensions landscape, with a shift away from defined benefit towards defined contribution pensions and a greater emphasis on the individual life course. Thus it is timely to revisit this area.The proposed project aims to exploit two nationally-representative datasets (Understanding Society and Labour Force Survey) in order to study the prospects of pension adequacy among individuals from BME groups in early- and mid-life, as well as the current differentials in pension protection between older persons from different BME groups, and between the BME population and the White majority. The two datasets include sufficient cell counts in order to study the BME population in early (20-44), mid- (45-64) and later (65 and over) life, and a range of variables which relate to the individuals' economic (eg. employer pension membership) and social (eg. living arrangements) resources. In addition, the research will pay particular attention to gender differences in pension protection within and between BME groups, in order to better understand the impact of informal care provision on pension income in later life, and to draw policy-relevant lessons in this area.The proposed research addresses the aims of the ESRC's Secondary Data Analysis Initiative in three distinct ways: firstly, by maximising the value of existing data resources; secondly, by developing high-quality evidence which can inform the future design of policy in the area of pension protection for BME groups and contribute to the effectiveness of social policy in this field; and thirdly, by engaging key stakeholders in the area of the wellbeing of BME older persons.