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FISCAL POLICY

The economic consequences of the UK’s ageing population

The UK is in the process of a major demographic shift as its population ages. What will the economic, cultural and social consequences be? Max Warner of the Institute for Fiscal Studies investigates

Thirty years ago, only 1.6% of the population was aged 85 years and over, but by 2020 this had risen to 2.5%, equivalent to 1.7 million people. This trend is predicted to continue, with the Office for National Statistics forecasting that by 2045 4.3% of the population will be aged 85 years and over.

This is equivalent to an almost doubling of the number of elderly people over the next two decades, driven both by increases in life expectancy and the ageing of ‘baby boomers’ — those born in the period after the Second World War. Moreover, this rapid growth isn’t just for the very old. The number of people aged 70 years and over, for example, is predicted to rise from 9.2 million in 2020 to 13.5 million in 2045.

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Evaluating trade unions

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Enterprise as a factor of production

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