January 2, 2010

UK: How will the ageing UK population impact upon the benefit system?

. LONDON, England / Financial Advice / Pensions / January 2, 2010 At this moment in time there around 10,000 UK citizens who are aged over 100 but this figure is set to increase dramatically in the short to medium term. Forecasts suggest that over 280,000 Britons will be aged over 100 by the year 2050 and there will be around 16 million pensioners in the UK, many under the state pension system. So how will this impact upon the UK benefits system? In many ways the UK government will be hit by a double whammy, with people living longer and the UK population continuing to grow. This will put more and more strain on the UK benefit system and UK finances as a whole and we will either see taxes increase, benefits decrease or a mixture of the two. There is no way that the UK government can continue to fund the benefit system at the current level without major changes across the board. Pension funds will become a vital part of everyday life for those in work today and it is likely that the benefits of the UK state pension will be reduced in real terms in the future. More and more emphasis will be placed upon private pension funds and we may well see a number of tax initiatives introduced in the years ahead, reversing many changes pushed through by Gordon Brown during this time at the Treasury. [rc] © 2007-2009 Financial Advice