UK Parliament’s House of Lords Economic Affairs Committee has published its report on “Preparing for an ageing society”, arguing that successive governments have failed to develop a coherent approach to the economic and social effects of falling fertility and rising life expectancy. The committee says that raising the State Pension Age is not an adequate solution because many people leave the workforce well before their sixties, and it urges the Government to prioritise measures that incentivise people in their mid-50s to mid-60s to remain in, or return to, work. The report highlights Office for Budget Responsibility (OBR) projections that, “on current policy settings”, ageing-related fiscal pressures could push borrowing above 20% and debt above 270% of GDP by the early 2070s, alongside an increase in the dependency ratio from 31% to 47% over the next 50 years. It argues that higher immigration would not be sufficient to address the challenge and that attempts to raise fertility rates elsewhere have largely failed. Recommended actions include removing tax and public service pension “cliff edges” that discourage continued work, addressing caring responsibilities and the adult social care workforce gap, tackling age discrimination (including self-directed perceptions), and setting out policies to narrow the gap between life expectancy and healthy life expectancy, noting evidence that almost a quarter of over-50s who leave work earlier than intended do so due to unsupported health needs. The committee also calls for better public understanding of retirement costs, including considering an education campaign and assessing whether the UK financial services sector is suitably organised to support the population as it ages.
UK Parliament 2025-12-19
UK Parliament’s Economic Affairs Committee warns ageing could push debt above 270% of GDP and calls for measures to keep older workers in work
The UK Parliament’s House of Lords Economic Affairs Committee released a report criticizing the lack of a coherent strategy for addressing the economic and social impacts of an ageing society. It argues that raising the State Pension Age is insufficient and recommends measures to incentivize workforce participation among those in their mid-50s to mid-60s. The report highlights fiscal pressures from ageing, the inadequacy of higher immigration, and the need for policies addressing health, discrimination, and retirement costs.