UK employees are used to stark warnings about the pensions crisis, but research released last week painted a somewhat brighter picture.
The report by the Tomorrow’s Company think-tank says that improvements in productivity will enable the ageing population to sustain itself. As each worker generates more wealth, they will be able to save more in pensions and pay more taxes to support the state pension, the report suggests.
It says the economy could suffer if everyone started saving instead of spending.
The pensions deficit is said to be 57bn, leading to claims of a ‘demographic timebomb’. But report author Philip Sadler insisted there was no “ageing crisis”.
“As a society we can afford to grow old,” he said. “Rising productivity will outweigh any negative influence on living standards.”