Despite all the warnings, the UK is not in the midst of a pensions crisis, according to a report.
The report, by think-tank Tomorrow’s Company, says rises 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 also points out that the economy could be damaged if everyone started saving more instead of spending.
The pensions deficits currently stands at £57bn, leading to claims of a ‘demographic timebomb’, but Philip Sadler, one of the report’s authors, 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 from an ageing population.”
The government’s Pension Commission issues a report later this month designed to tackle the deficit. It is expected to propose employees are automatically opted-in to company pensions.
