The ONS has today published an update on UK population projections, which shows that the next century will see people of pension age grow by 8.3 million.
The ratio of working-age to pension-age population is expected to change over the next 100 years, as shown in the graph below. Currently, less than a fifth, or 17.7 per cent, of the population is of state pension age- a figure that is expected to rise to 28.5 per cent by 2120.
Canada Life technical director Andrew Tully says: “The ONS data signals a significant shift in the make-up of the UK population over the next century. The change in proportion of working-age to pension age population is stark, while the amount of births is set to fall over the same period.
“The data leaves some profound questions for future popolicymakersWhile the basis of our tax and social care system might work with today’s demographics, this won’t be the case in the future based on these projections. The future of the state pension in its current form will be called into question.”
Aviva head of savings & retirement Alistair McQueen says: “The future is a very different place. Today’s projections show the massive increase in the number of people of state pension age over the coming century – rising from 11.9 million in 2020 to 20.2 million in 2120. In 2020 state pensioners represent 17.7 per cent of the total population, this figure is projected to rise to 28.5 per cent in 2120. More than one in four people will be of state pension age.
“This rise celebrates our rising life expectancy. But it comes with consequences. The state will face a rising bill for healthcare, social care and pensions. People will face greater individual responsibility to provide for their longer, later life.
“Today, there are a record number of people saving for their retirement. But millions are saving at inadequate levels. We must encourage more individual retirement provision, if we are to thrive, not just to survive, in later life.”