UK time bomb as population grows older

 
Julian Harris
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TWICE as many “very old people” (aged 85 and over) are living in Britain compared to 25 years ago, government figures revealed yesterday.

And there are now more pensioners than children (under 16), as population ageing takes it toll.

Since 1984 the proportion of British people under 16 fell by two per cent, and the proportion over 65 increased by one per cent, said the Office for National Statistics (ONS).

Last month the government’s Office for Budget Responsibility (OBR) warned: “if left unaddressed, upward pressure on spending from the ageing of the population might well put public sector net debt on an unsustainable upward trajectory.”

According to the International Monetary Fund (IMF) the effect of population ageing on the UK is seven times greater than the harm inflicted by the economic crisis.

“Pressures from ageing need to be addressed by reforming pension and health entitlements,” the IMF said.

“Postponing required reforms would likely result in larger and more painful adjustment in later years.”

The proportion of working age people slightly increased since 1984, the ONS reported. But Patrick Nolan of the think tank Reform warned it will fall in the future.

“We’re going to have a decreasing proportion of people to fund services like health, pensions, and elderly care,” he said. “Young people have to pay for their own pensions while also funding pensions and care for today’s elderly, through taxes.”

Countries like Singapore, New Zealand, Australia and Chile are reforming public services with mechanisms for people to save for their own retirement costs, said Nolan.

However, the situation is worse in countries with lower fertility rates than the UK, the ONS reported.

Italy and German have the most aged populations in Europe, it said, while Japan has the most elderly population in the world.

The data also showed that one in ten people in the UK were born abroad, a lower rate than observed in most of the other surveyed countries.

Switzerland and Ireland were among the countries with a higher proportion of foreign born residents.