EUROPE – The European Commission says European Union governments need to step up reform efforts to deal with their ageing populations.
“European Union governments need to step up reform efforts in the face of rapidly ageing populations,” the Commission said, announcing a new report that is to be submitted to EU finance ministers that was prepared by the Commission and the Economic Policy Committee.
It said: “The scale of the demographic challenge is immense. The retirement of the baby-boom generation as of 2010 and continuous increase in life expectancy means Europe will go from having four to only two people of working age for every elderly citizen by 2050.
“With unchanged policies, EU potential growth rates will be almost cut in half by 2030. Public finances will come under severe strain due to increased spending on pensions, health care and long-term.”
Despite this there were some positive signs that member states are facing up to the challenge. It said: “Several countries have curtailed access to early retirement schemes and have made reforms to their pension systems.” Such reforms paid off “both by raising effective retirement ages and by better controlling future public spending pressures”.
"While the process of an ageing population cannot be turned around, the consequences for prosperity and sustainability lie in the hands of governments,” said Economic and Monetary Affairs commissioner Joaquin Almunia.