An estimated two million pensioners in the UK are living in poverty, according to the latest official figures.
But the number of people who are in poverty has fallen by nearly a third from 2.9 million in 1998/99 to two million in 2007/08, the most recent period for which figures are available.
A further one million people aged over 60 who live alone were also in fuel poverty in England in 2007, meaning they had to spend more than 10% of their income on heating, the Office for National Statistics said.
The ONS analysis found that the difference in income for the richest and poorest households was lower for pensioners than for people who were not retired.
But it added that income inequality increased during the past three decades, particularly during the period between 1977 and 1990.
There has also been a pronounced shift in the source of pensioners' income since 1977.
Money from occupational pensions and annuities accounted for an average of just 18% of retired people's income in 1977, with the state pension accounting for 53%.
But by 2007/08, the latest period for which figures are available, the state pension made up only 37% of the money pensioners had coming in, with occupational pensions and annuities accounting for 36%.
Around 11% of pensioners' income came from investments in 2007/08, while 13% came from benefits.
Figures released by the ONS showed that the liabilities faced by unfunded public sector pension schemes fell to £770 billion in March 2008, down from £810 billion 12 months earlier, although it said much of the improvement was due to changes in accounting assumptions.