On The Sustainability of the UK State Pension System in the Light of Population Ageing and Declining Fertility

As a result of population ageing and declining fertility, the UK state pension system is unlikely to continue to be able to deliver the current level of pensions without some combination of a higher state pension age and a steady inflow of young immigrant workers from abroad. However, with prudent e...

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Bibliographic Details
Published in:	The Economic journal (London) Vol. 116; no. 512; pp. F286 - F305
Main Authors:	Blake, David, Mayhew, Les
Format:	Journal Article
Language:	English
Published:	Oxford, UK Blackwell Publishing Ltd 01-06-2006 Blackwell Publishers Oxford University Press
Subjects:	Age Age groups Demographics Demography Economic systems Economic theory Employee pension plans Fertility Fertility decline Old age benefits Pension contributions Pension plans Pensions Population ageing Population aging Retirement Social conditions & trends Social security Studies Sustainability Sustainable economies United Kingdom Welfare United Kingdom > UK British Isles
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Summary:	As a result of population ageing and declining fertility, the UK state pension system is unlikely to continue to be able to deliver the current level of pensions without some combination of a higher state pension age and a steady inflow of young immigrant workers from abroad. However, with prudent economic management and continuing economic growth, the need for additional immigrants can be contained and modest real increases in pensions are also a possibility. Higher economic activity rates among older people, including deferred retirement, will to some extent compensate but not eliminate these pressures. If fertility picks up over the next few years, this will also help, but not until after 2030.
Bibliography:	istex:E44BD2AD43B6A403FA304743234C2B05B3F83F67 ark:/67375/WNG-QG3PX0WM-2 We gratefully acknowledge the comments of Steven Haberman, and three anonymous referees. This article is based, in part, on written evidence presented to the House of Lords Economic Affairs Committee of Enquiry into 'Aspects of the Economics of Ageing' on 2 February 2003, 11 March 2003 and 4 April 2003. Financial support for this study was provided by the European Commission under the Fifth Framework (ActivAge). ArticleID:ECOJ1100 We gratefully acknowledge the comments of Steven Haberman, and three anonymous referees. This article is based, in part, on written evidence presented to the House of Lords Economic Affairs Committee of Enquiry into ‘Aspects of the Economics of Ageing’ on 2 February 2003, 11 March 2003 and 4 April 2003. Financial support for this study was provided by the European Commission under the Fifth Framework (ActivAge). ObjectType-Article-1 SourceType-Scholarly Journals-1 ObjectType-Feature-2 content type line 23 ObjectType-Article-2 ObjectType-Feature-1
ISSN:	0013-0133 1468-0297
DOI:	10.1111/j.1468-0297.2006.01100.x