Ahead of the Autumn Statement this week, David Sinclair, Chief Executive of the International Longevity Centre – UK (ILC) said:

“Addressing skills shortages driven by ageing has to be at the heart of the Chancellor’s plan for economic growth. Future increases in the State Pension Age will eventually increase the supply of workers as our population ages, but the Chancellor needs to do more now.”

“Real-term cuts in education spending and the decimation of adult learning have left us unprepared for ageing and longer lives. Investment in education and learning is core to levelling up and addressing the causes of long-term poverty.”

“Over a million people leave the workforce before the state pension age and poor health is a major driver of this trend. We are living longer but aren’t healthier. Government must refocus health spending with a commitment to investing 6% of the health budget on preventative health.”

“The Chancellor must use taxation to disincentivise us from making unhealthy choices and encourage us to look after ourselves better. Too often the free market encourages us all to make poor choices yet taxation can play a role help us make healthy choices about what we eat and drink.”

“The welfare state is struggling to cope with an ageing society. We need a new “Beveridge Report” to help Government deliver radical and holistic systemic reforms in the context of longer lives. Without a long-term plan, our welfare state will wither.”

“The Chancellor needs to ensure fiscal policy doesn’t disincentivise people to work longer. Tax and pension policy must encourage rather than discourage longer working lives, for example.”

“With demographic change, the impacts of successive crises and falling migration driving huge skills gaps and worrying vacancy trends across our economy, the future looks bleak for UK PLC unless we invest in the longer term.”

“The Government must invest in future generations but also be intergenerationally fair. This is a difficult balancing act for the Chancellor, but the priority must be to think long-term and focus on prevention.”

“Preventing poverty and ill health while better equipping us all for longer lives, through an investment in learning, must be core to the Chancellor’s long-term plan to get the economy on track.”

Ends

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Notes

1. The State Pension Age is gradually increasing. It was due to reach 67 by 2028. The 2017 State Pension Age Review (Cridland Review) recommended an increase in the State Pension Age to 68 over two years from 2037, but the Government planned to undertake another review before legislating. In December 2021, the Government announced the launch of the second State Pension Age Review conducted by Baroness Neville-Rolfe. In the second week of September 2022, Baroness Neville-Rolfe submitted her independent report to the then Secretary of State for Work and Pensions, Rt Hon. Chloe Smith MP. The Government is yet to publish the report or their response to it. Currently, the state pension costs the Government over £100bn a year and has increased 3-fold since 2000. Any increase in the SPA could stop this cost from inflating even further, but to varying levels depending on how it is calculated. ILC research in January 2022 showed that the SPA may need to rise faster than expected, to ensure fiscal sustainability, support intergenerational fairness and keep up with increases in life expectancy. Not if but when: The demographic and fiscal case for increases to State Pension Age – ILCUK
2. Increasing preventative health spending by just 0.1% could unlock a 9% increase in annual spending by people aged 60+. Stopping people from smoking alone, would add an average of 5.4 more years of good health to every individual and boost the UK economy by £19.1 billion. Up in smoke: The impact of smoking on health and economic activity – ILCUK
3. Research conducted by Professor Les Mayhew on ‘The cost of inequality: Putting a price on health’ published in July 2021 by the Centre for the Study of Financial Innovation (CFSI), in partnership with ILC and The Business School at City University, challenges conventional wisdom by proposing a novel way of thinking about inequalities that link health to wealth and to the economy.
4. Across the UK, 900,000 people live with dementia – this could be up to 1.6 million by 2040. Statistical analysis carried out by ILC on the English Longitudinal Study of Ageing and ONS datasets reveals that high streets lose between £110 million and £1.6 billion (averaging £948 million) due to a failure to adapt to dementia. Those who report their mental abilities as “poor” spend 58.2% less on leisure, 51.4% less on non-essentials and 38.7% less in total than those who feel that they have excellent mental abilities. The full report is available from https://ilcuk.org.uk/retail-therapy-dementia-and-spending