However, new figures show UK pensions are now in a shambolic state and rank the WORST in the developed world – far below Mexico and Chile, according to a think tank.
Hard working people who enter the workforce today will receive less than a third of their final working salary as a basic pension after tax.
Figures from the Organisation for Economic Co-operation and Development show that this ranks 40 per cent lower than those who kicked off their careers in 2002.
Workers who started their careers 15 years ago, could have expected to take home a pension which would be much more than today’s workforce.
The current state pension is £159.55 per week.
The OECD said the fall in retirement cash is because the Government changed the earnings related state pension to a new flat rate.
Britain’s dismal pension pots stand in direct contrast with the rest of the developed world where workers will get at least 63 percent of their salary as a pension.
At present, Holland, Denmark and Italy receive the highest pensions as they combine work and state pensions together.
The OECD warns that another challenge to pensions is the allowance for older people to withdraw cash from their pensions.
They warn that this could lead to even more problems if people drain their pots dry and have nothing to live on as they get older.
The number of over-65s in work will increase from about three in 10, to nearly half by 2050.
Poverty levels of those aged 75 and over are 18.5 per cent, compared to 11 per cent among the whole population.
The state pension age will rise to 68 between 2037 and 2039.
The OECD report said: “With the introduction of the new single-tier pension – 30 per cent higher than the old state pension – the situation should improve but there is a long transition period and current retirees will not see a difference.
“People who have had sufficient income during their working lives to save, buy their own home and contribute to private pensions have relatively good incomes compared to younger generations.
“However, retirees without such additional sources of revenue are left with few resources; this is reflected in the poverty rate and high income inequality in the United Kingdom for the over 65s.
“Following the sharp rise of income disparities during the 1980s in the United Kingdom, inequalities in later life will rise further as generation X approaches retirement.’
Frances O’ Grady, the general secretary of the Trades Union Congress blasted that “workers are being let down.”
He said: “We are letting down today’s workers if we can’t provide them with decent retirement income.”