Govts must tackle ageing issue now: UN

Nations urged to improve policies, practices to support elderly people

The Straits Times, 2 Oct 2012

TOKYO - Governments around the world must work out how to cope with ageing, a United Nations report said yesterday, warning that developing nations with lots of young workers may one day find their elderly populations a burden.

The study by the UN Population Fund (UNFPA) and HelpAge International also urged countries to improve medical provision to extend the years of health older people can enjoy.

The report, which was released to coincide with the International Day of Older Persons, estimates that one in nine people around the world is older than 60, accounting for some 810 million of the global population of seven billion.

The size of the elderly population is set to swell by 200 million in a decade to go beyond one billion, and soar to two billion by 2050, the report said.

Alongside the report, a symposium on ageing was being held in Japan - the world's fastest-greying country - where about a quarter of the population is over 65, a proportion the government forecasts will rise to 40 per cent within 50 years.

"The world is quickly becoming much older, and developing countries will be taking the lead in terms of the speed of this process," said UNFPA executive director Babatunde Osotimehin. "Population ageing is one of the most significant trends in the 21st century," he told a press conference.

By 2050, the report said, some 80 per cent of the world's older people will live in developing countries, many of which currently have young populations where there are many more workers than pensioners.

"In many developing countries with large populations of young people, the challenge is that governments have not put policies and practices in place to support their current older populations or made enough preparations for 2050," the bodies said in a joint statement.

The report warned that the skills and knowledge older people possess are going to waste, with many of them under-employed and vulnerable to discrimination, abuse and violence at work and in the home.

Many of the world's elderly also live in poverty and have difficulty accessing medical care, making them vulnerable to chronic conditions, they said.

The agencies called for governments and the public to end "these destructive practices and to invest in older people".

"Countries must address their ageing mismanagement, and put in place strong laws and associated plans and budgets," said HelpAge chief executive Richard Blewitt.

He called for wider use of basic social programmes, including affordable medical care for elders, as well as the abolition of a mandatory retirement age.

AGENCE FRANCE-PRESSE

Growing number of senior citizens

WORLD

2000: For the first time, more people above 60 than children under five

2022: One billion people above 60

2050: Group above 60 outnumbers those under15

SINGAPORE

2030: Residents 65 and older will make up 20 per cent of the population, compared with about 10per cent now

CHINA

NOW: 123 million people above age 65

2030: Percentage of the elderly as a proportion of working-age adults hits 34.4 per cent in rural areas, versus 21.1 per cent in urban areas

SOURCES: UNITED NATIONS, WORLD BANK

FAST-GREYING CHINA
Pension black hole looms as society ages
The Straits Times, 2 Oct 2012

QINGHAI - Eighty-year-old Chinese farmer Guo Shuhe receives a state pension of just US$9 (S$11) a month, not enough to buy a month's worth of groceries, but enough it seems, to risk punching a gaping hole in the government's finances.

Mr Guo, whose palms are thick and rough from a life spent hoeing fields in south- west China, is one of more than 150 million people covered by a rapidly expanding rural retirement scheme which is accelerating the nation's slide into a pension crisis.

"Fifty-five yuan a month is little, but it's better than nothing," said Mr Guo at his home in Ledu County, a village 3,000m above sea level in China's mountainous Qinghai province, bordering Tibet.

Mr Guo, though, is fortunate because he also has the financial support of six children. But for younger and future generations of retirees, China's traditional family safety net is disappearing, replaced by state- backed pension schemes tailored for a greying society.

Policymakers and economists have long been worried about the financial burden of China's expanding patchwork of pension schemes, but those concerns have recently escalated as its rural pension scheme took off in the past three years.

The funding shortage is daunting: Economists say it could blow out to a whopping US$10.8 trillion in the next 20 years, from US$2.6 trillion in 2010, towering over China's US$3 trillion onshore savings, the biggest hoard of domestic savings in the world.

Time is not on China's side. Its fast-maturing society and economy - thanks to a one-child policy and a rapid rise in living standards - demand better pension coverage in future.

Yet China is already straining to hold things up. Funding capacity is not keeping pace with swift growth in pension coverage as China sticks to safe but low-yielding investments for its pension funds.

To make bad matters worse, retirements are getting pricier on an ageing population, a shrinking workforce, longer life expectancies, early retirements and generous pension payouts.

So pressing are China's pension problems that analysts say they can no longer be ignored.

Mr Xi Jinping, China's president-in-waiting, must raise retirement age and supply pension funds with state assets for financing after he takes power next year.

"This is a very important issue for the next leadership, which does not have a lot of time to get to it," said economics professor Zhao Xijun of Renmin University in Beijing.

REUTERS