Michael Ahern
Ceist:52 Mr. M. Ahern asked the Minister for Social Welfare the plans, if any, being considered for the future funding of pensions in view of the projected demographic trends in the next 30 years. [15249/95]
Vol. 458 No. 2
52 Mr. M. Ahern asked the Minister for Social Welfare the plans, if any, being considered for the future funding of pensions in view of the projected demographic trends in the next 30 years. [15249/95]
On a number of occasions recently I have drawn attention to the demographic patterns which indicate a considerable increase in the proportion of elderly people in the population over the first half of the next century. This will have a significant impact on the future costs of social welfare pensions, which are set to increase by some 100 per cent by the year 2035. At the same time, the ratio of persons in the economically active age group to those over age 65 is projected to fall. This would result, in the absence of any policy change, in an increasing burden of the cost of pensions falling on future generations of PRSI contributors and taxpayers.
These are important factors in any consideration of the development of future pension arrangements and raise serious questions about the capacity of the present financing arrangements to meet these emerging costs. The pensions industry is also placing considerable emphasis on this issue at present. One aspect which needs to be examined further in this regard is the effect of real long-term growth in the economy. If this is maintained, it should increase the resources available to pay for pensions in the future; although as the Deputy will appreciate, there will be many competing claims for any resources freed up as a result of this growth. I am examining the reports on this area at present.