NETHERLANDS - The central Dutch think-tank, the Netherlands Bureau for Economic Policy Analysis (CPB), has warned that people are too optimistic about the expense of longevity.

CPB director Coen Teulings expects that ageing will cost more than even his own think-tank was predicting in 2006.

The CPB published a report in which overall government expenses on the long term would need to decrease by €11bn to counter ageing costs.

In a TV programme, he explicitly countered claims made by politicians, such as former-Labour Party (PvdA) minister Marcel van Dam, former Christian Democrat Minister Bert de Vries and Socialist Party leader Jan Marijnissen, that costs of ageing have been overstated.

Teulings remarks come at a very sensitive period, as three Dutch political parties are in discussion to form a new coalition government. Two of the parties involved (Labour and Christian) are trying to start part-taxation of the first pillar pension system.

Remarks by Teulings will be taken into account by the respective party-leaders, as increased ageing costs are going to make the taxation proposal of the Labour and Christian parties more palatable.

Teulings, without trying to interfere in the current government discussions, however stated openly that he hopes that future governments will invest budget reserves appropriately in the coming years.