Although the number of births and deaths are expected to equal each other out (both being 6.8 million), the UK population is projected to increase to 72.5 million in 2032 due to net migration of 4.9 million
This increase in figures could help to bolster the ratio of the number of working people to pensioners
The number of people aged 85 years and over was 1.7 million in 2022, but this is expected to double to 3.3 million by 2047 – making up 4.3% of the population
Rachel Vahey, head of public policy at AJ Bell, comments: “The size and the make-up of the UK population matters when it comes to pensions. We are experiencing an ageing population, with the 1960s ‘boomer’ generation now reaching state retirement age, boosting the number of UK pensioners by a whopping 14% over the next 10 years.
“Whilst more people living longer should be something to be celebrated, a growing pensioner population puts more pressure on public finances to fund state pensions and provide care in older age. The ratio of working people to pensioners has to at least remain stable to make sure sufficient taxes are rolling in to help pay for these burgeoning costs. But with a falling birth rate that ratio looks fragile.
“The ONS figures today point to an increase in migration to help steady that ship. A swell in the working age population should at least help ease some of the financial pressure, but it won’t completely solve the problem.
“The UK needs a frank and open discussion about pensioners’ income in later life. Instead of kicking conversations about the state pension down the road we need a full debate on how much the state pension should be, when it should be paid and how it should increase each year.
“But this goes wider than state pensions. The government has already shelved its promised review of UK pensions adequacy. It now needs to kick that back into action to examine if the UK is on course to be able to finance itself in old age. These figures make it clear there isn’t time to spare by putting this on the back burner. Making significant changes will take time, so we need to tackle these challenges today.”
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