Europe's ageing demography 5 nov14

Europe’s Ageing Demography

Wednesday 5th November 2014

An ILC-UK Population Patterns Seminar Series event

#populationpatterns

Welcome

Lawrence ChurchillILC-UK Trustee


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Welcome

Maureen O’NeillEuropean Economic and Social Committee


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Europe’s Ageing DemographyThe key facts on Europe’s Ageing Population

Helen CreightonILC-UK


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Background

UK Fact PackGrowing EU integrationFiscal sustainability concerns

The European Population is…

2013 2020 2030 2040 2050 2060 2070 2080495,000,000

500,000,000

505,000,000

510,000,000

515,000,000

520,000,000

525,000,000

530,000,000

Source: EuroStat

Tota

l Pop

ulati

on

… a growing population

…and an ageing population

1960 1970 1980 1990 2000 2010 2020 2030 2040 2050 20600

5

10

15

20

25

30

35

40

45

50

Source: EuroStat

Med

ian

Age

A Pan-European perspective hides regional differences

Populations in European regions, 2013=100

A Pan-European perspective hides regional differences

2010 2060

Countries with a percentage of their population over 65 years of age above the EU average

What is it like to grow old in Europe?

- Health and life expectancy- Housing quality and costs- Work and retirement- Pensions and poverty

Pensioner Poverty

Material Deprivation rates among the over 65s

BulgariaLa

tvia

Romania

Lithuania

Hungary

Croatia

Poland

Greece

Slova

kia

Cypru

sIta

ly

Portugal

Estonia

Czech

Republic

Slove

niaM

altaEU 28

Spain

Ireland

Germany

France

Austria

Belgium UK

Finland

Netherlands

Denmark

Iceland

Luxe

mbourg

Switz

erland

Sweden

Norway

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

Source: EuroStat

Perc

ent

Pensioner Poverty

Relative Poverty rates among the over 65s

Switzerla

nd

Cyprus

Bulgaria

Croatia

Slovenia

Lithuania

Finland

Belgium

Sweden

Portugal

Malta

Estonia

Greece Italy

United Kingdom

Romania

Austria

Germany

Spain

EU (28 co

untries)

Denmark

PolandLa

tvia

Ireland

France

Norway

Slovakia

Luxe

mbourg

Czech

Republic

Hungary

Netherlands

0

5

10

15

20

25

30

35

Source: Eurostat

Perc

ent

State pension adequacy

Replacement rate provided by the state pension to the average earner

GreeceSpain

Austria

Cyprus

Italy

Slovenia

Finland

Portugal

Czech

Republic

BulgariaEU27

France

Romania

Norway

Hungary

Belgium

Germany

Sweden

Switzerla

nd

Lithuania

United Kingdom

Latvi

a

Netherlands

Ireland

Denmark

Poland

Estonia

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

90.0

100.0

Source: OECD

Perc

ent

Early Retirement

• While there has been a 10.2% increase in employment of older workers (55-64) in the EU in the last 10 years, in 2013 just 50.1% of those aged 55-64 were in employment.

• Employment rates range between 73% in Sweden and 35.6% in Greece.

What are the costs of an ageing society?

PensionsHealthcareOld age benefits

Projected pension expenditure as a percentage of GDP in the EU-27

2010 2015 2020 2025 2030 2035 2040 2045 2050 2055 206010

10.5

11

11.5

12

12.5

13

13.5

Source: European Commission, Economic Policy Committee

Perc

ent

Healthcare

In 2010 healthcare expenditure in the EU-27 was around 7% of GDP.

The European Commission’s reference scenario puts healthcare spending at 8.2% of GDP in 2050 in the EU-27.

Based on different scenario’s they predict spending could be between 6.7% and 12.6% of GDP

Social protection expenditure on old age care in euros per inhabitant, 2011

Denmark

Switz

erland

Sweden

United Kingdom

France

Finland

Germany

Ireland

Spain

Cypru

sM

alta

Hungary

Estonia

Latvi

a

Croatia

Bulgaria0.00

1,000.00

2,000.00

3,000.00

4,000.00

5,000.00

6,000.00

Source: EuroStat

Euro

Per

Inha

bita

nt

Fritz Von NordheimEuropean Commission


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Maciej KucharczykAge Platform Europe


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Jean LambertMEP


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Andrew RearMunich Re


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Richard WilletsPartnership


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Post-retirement life expectancy in the EU

Richard Willets

ILC-UK 2014 EU Factpack launch - 5 November 2014

• Post-retirement life expectancy is a key determinant of the cost of pension provision; policy regarding retirement age; the dependency ratio, etc.

• This presentation considers life expectancy at age 65 in EU nations.

• The split into Eastern, Northern, Southern and Western Europe mirrors the approach taken in the ILC-UK EU Factpack.

• Historic data was obtained from the Eurostat database1 and the Human Mortality Database2.

• Projected figures for future years were taken from the Eurostat database.

Post-retirement life expectancy in the EU

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25

• 1 http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database (data downloaded on 19 Oct 2014).

• 2 Human Mortality Database. University of California, Berkeley (USA), and Max Planck Institute for Demographic Research (Germany). Available at www.mortality.org or www.humanmortality.de (data downloaded on 19 Oct 2014).

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

http://www.mortality.org/

http://www.humanmortality.de/

Variation in post-retirement life expectancy in the EU

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26

• Source: own calculations using Eurostat data

Life expectancy (at age 65) for males, by EU country, 2010-12Life expectancy (at age 65) for males, by EU country, 2010-12

Latv

ia

Bulgar

ia

Lithu

ania

Hunga

ry

Slovak

ia

Roman

ia

Eston

ia

Croat

ia

Poland

Czech

Rep

ublic

Sloven

ia

Denm

ark

Portu

gal

Finlan

d

Belgium

Luxe

mbo

urg

Irelan

dM

alta

Nethe

rland

s

Austri

a

Ger

man

y

Cypru

s

Gre

ece

United

King

dom

Italy

Sweden

Spain

Franc

e10

11

12

13

14

15

16

17

18

19

20

Western Europe

Southern Europe

Northern Europe

Eastern Europe +5.7 years


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27


Life expectancy (at age 65) for females, by EU country, 2010-12Life expectancy (at age 65) for females, by EU country, 2010-12

Bulgar

ia

Roman

ia

Hunga

ry

Slovak

ia

Latv

ia

Croat

ia

Lithu

ania

Czech

Rep

ublic

Poland

Eston

ia

Denm

ark

Cypru

s

Irelan

d

United

King

dom

Gre

ece

Malt

a

Nethe

rland

s

Sloven

ia

Ger

man

y

Sweden

Portu

gal

Belgium

Austri

a

Luxe

mbo

urg

Finlan

dIta

lySpa

in

Franc

e14

15

16

17

18

19

20

21

22

23

24

Western Europe

Southern Europe

Northern Europe

Eastern Europe+6.3 years


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Life expectancy (at age 65) , for selected EU nations, 2010-12Life expectancy (at age 65) , for selected EU nations, 2010-12

EU Nation Gender Life expectancy at age 65 (years)

France Female 23.5

Latvia Male 13.4

10.2 years

Trend by region - males

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29

Source: own calculations using Eurostat and Human Mortality Database data.Eastern European countries: CZK, HUN, SVK; Northern European countries: DNK, FIN, SWE;Southern European countries: ESP, ITA, PRT; Western European countries: AUT, BEL, FRA, IRE, NLD, GBR.

Life expectancy (at age 65) for males, average for selected countries in regions, 1950-52 to 2010-12 Life expectancy (at age 65) for males, average for selected countries in regions, 1950-52 to 2010-12

11

12

13

14

15

16

17

18

19

Eastern Europe

Northern Europe

Southern Europe

Western Europe


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30



11

12

13

14

15

16

17

18

19

Eastern Europe

Northern Europe

Southern Europe

Western Europe


April 13, 2023

31



11

12

13

14

15

16

17

18

19

Eastern Europe

Northern Europe

Southern Europe

Western Europe

Trend by region - females

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32


Life expectancy (at age 65) for females, average for selected countries in regions, 1950-52 to 2010-12 Life expectancy (at age 65) for females, average for selected countries in regions, 1950-52 to 2010-12

13

14

15

16

17

18

19

20

21

22

23

Eastern Europe

Northern Europe

Southern Europe

Western Europe

Increase over successive decades

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33


Increase in life expectancy (at age 65) for males in years, over successive 10-year periods, average for selected countries in regions, 1950-52 to 2010-12Increase in life expectancy (at age 65) for males in years, over successive 10-year periods, average for selected countries in regions, 1950-52 to 2010-12

1951-1961 1961-1971 1971-1981 1981-1991 1991-2001 2001-2011

-1.0

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

Eastern Europe

Northern Europe

Southern Europe

Western Europe

Increase in the last decade

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34

Source: own calculations using Eurostat data.

Increase in life expectancy (at age 65) for males in years, from 2000-02 to 2010-12, by EU nation Increase in life expectancy (at age 65) for males in years, from 2000-02 to 2010-12, by EU nation

Lithu

ania

Bulgar

ia

Latv

ia

Hunga

ry

Roman

ia

Croat

ia

Slovak

iaIta

ly

Poland

Sweden

Greec

e

Czech

Rep

ublic

Cypru

s

Austri

aSpa

in

Eston

ia

Portu

gal

Belgium

Denm

ark

Finlan

d

Germ

any

Luxe

mbo

urg

Franc

e

United

King

dom

Nethe

rland

s

Sloven

iaM

alta

Irelan

d0.0

0.5

1.0

1.5

2.0

2.5

3.0

Projected increases for Western Europe

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35

Source: own calculations using Eurostat and Human Mortality Database data.

Increase in life expectancy (at age 65) for males in Western Europe in years, over successive decades, actual & projectedIncrease in life expectancy (at age 65) for males in Western Europe in years, over successive decades, actual & projected

1951-1961 1961-1971 1971-1981 1981-1991 1991-2001 2001-2011 2011-2021 2021-2031 2031-2041 2041-2051

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5


April 13, 2023

36



1951-1961 1961-1971 1971-1981 1981-1991 1991-2001 2001-2011 2011-2021 2021-2031 2031-2041 2041-2051

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

Possible fu-ture in-

creases?


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37



1951-1961 1961-1971 1971-1981 1981-1991 1991-2001 2001-2011 2011-2021 2021-2031 2031-2041 2041-2051

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5


creases?


April 13, 2023

38



1951-1961 1961-1971 1971-1981 1981-1991 1991-2001 2001-2011 2011-2021 2021-2031 2031-2041 2041-2051

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5


creases?


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39



1951-1961 1961-1971 1971-1981 1981-1991 1991-2001 2001-2011 2011-2021 2021-2031 2031-2041 2041-2051

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

Eurostat principal projection

Projected life expectancy by region

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Life expectancy (at age 65) for males, by region, actual & projectedLife expectancy (at age 65) for males, by region, actual & projected

195119561961196619711976198119861991199620012006201120162021202620312036204120462051205620612066207110

12

14

16

18

20

22

24 Eastern Europe

Northern Europe

Southern Europe

Western Europe

Increase in the last decade

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41


Increase in life expectancy (at age 65) for males in years, from 2000-02 to 2010-12, by EU nation Increase in life expectancy (at age 65) for males in years, from 2000-02 to 2010-12, by EU nation

Lithu

ania

Bulgar

ia

Latv

ia

Hunga

ry

Roman

ia

Croat

ia

Slovak

iaIta

ly

Poland

Sweden

Greec

e

Czech

Rep

ublic

Cypru

s

Austri

aSpa

in

Eston

ia

Portu

gal

Belgium

Denm

ark

Finlan

d

Germ

any

Luxe

mbo

urg

Franc

e

United

King

dom

Nethe

rland

s

Sloven

iaM

alta

Irelan

d0.0

0.5

1.0

1.5

2.0

2.5

3.0

Projected increase over the next decade

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Projected increase in life expectancy (at age 65) for males in years, from 2010-12 to 2020-22, by EU nation Projected increase in life expectancy (at age 65) for males in years, from 2010-12 to 2020-22, by EU nation

Lithu

ania

Bulgar

ia

Latv

ia

Hunga

ry

Roman

ia

Croat

ia

Slovak

iaIta

ly

Poland

Sweden

Greec

e

Czech

Rep

ublic

Cypru

s

Austri

aSpa

in

Eston

ia

Portu

gal

Belgium

Denm

ark

Finlan

d

Germ

any

Luxe

mbo

urg

Franc

e

United

King

dom

Nethe

rland

s

Sloven

iaM

alta

Irelan

d0.0

0.5

1.0

1.5

2.0

2.5

3.0

• Post-retirement life expectancy in EU nations has been increasing at an accelerating rate in recent decades.

• The differential between the lowest and highest life expectancy nations has been widening.

• Eurostat’s projection of future mortality, which is a key component of population projections, assumes the pace of improvement for high life expectancy nations will slow dramatically.

• The pace of improvement for low life expectancy nations is projected to continue at a more rapid rate – and hence the gap is assumed to narrow.

Summary

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Thank you

April 13, 2023

44

Partnership is a trading style of the Partnership group of Companies, which includes; Partnership Life Assurance Company Limited (registered in England and Wales No. 05465261), and Partnership Home Loans Limited (registered in England and Wales No. 05108846).

Partnership Life Assurance Company Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Partnership Home Loans Limited is authorised and regulated by the Financial Conduct Authority. The registered office for both companies is Sackville House, 143-149 Fenchurch Street, London EC3M 6BN.

Gemma Perkins

shoudl there be a statement here about not being reproduced etc?

Gemma Perkins

Old address - needs to be updated. Please can you make sure that all presentation templates that you use have the correct registered address.

Discussion

Lawrence ChurchillILC-UK Trustee


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Europe's ageing demography 5 nov14

Presentations & Public Speaking

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