Global Aging Issues
Reflections on the 2005 Global Aging Debate
Opinion
December 2005
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Ladan Manteghi
Director, AARP Office of International Affairs
Global demographic change and economic outlook are increasingly the context in which policymakers think and work. But this context is extending beyond policymakers leading to cross-disciplinary conversations between decisionmakers at the non-governmental, corporate and governmental levels. Leaders in all spheres are beginning to appreciate how the aging of global populations will touch nearly every aspect of our societies - our economies, our politics, our cultures, and our infrastructures. They also understand that actions taken now to address these changes are more humane and judicious than those taken under duress. I am proud that AARP has played a role in furthering these conversations.
In 2005, retirement issues of focus worldwide went beyond income to include health and long-term care. Policymakers have been grappling with ways for sources of retirement income to remain sustainable under the demographic pressure as the baby boomer generation reaches retirement age. In the US, President Bush launched a controversial campaign to privatize a portion of the Social Security system by carving out “private” accounts from the public benefit. However, the proposal has not led to reforms thus far. In the UK, Pensions Commissioner Adair Turner introduced the Commission’s final recommendations to now be taken up by Parliament, which included proposals such as changing the state pensions to flat rates, introducing a low cost universal employer based national pension, and raising the pensionable age to 68. The Norwegian government recently introduced proposals to set up mandatory occupational pensions that could affect up to 600,000 people.
In addition to pensions, health and long-term care also infused major political debate in 2005. To the dismay of older Japanese, their government introduced increased cost sharing responsibility to the long-term care insurance program launched in 2000, and recently put forth recommendations for even further cost-sharing in health care for persons over age 65. In Germany, differences over ideas on pension and health care reform almost brought government coalition talks to a complete halt.
All of these developments indicate that policymakers are realizing the urgency of the need for addressing the challenges that the demographic shift will have on social safety net programs. To improve our own understanding of attitudes and behaviors surrounding personal and national retirement issues, AARP recently commissioned a major international poll of the general population aged 30-65 in 10 industrialized countries, including Australia, Japan, Germany, France, Italy, Sweden, the Netherlands, the United Kingdom, Canada, and the United States. The survey aimed to assess the public’s confidence in having sufficient income to retire comfortably, attend to their health and long-term care needs, and live securely after leaving the workforce.
While across countries, we found generally that people held guarded optimism towards retirement security, the most concerning finding was that in every country surveyed, there was low confidence in governments to provide benefits to current retirees, and even lower confidence that governments will meet their obligations to future retirees. To further explore what was behind these sentiments, in July 2005, the AARP Global Aging Program hosted a forum in Washington, DC titled, Reinventing Retirement – Balancing Risk, which convened international participants for discussions on balancing risk in retirement systems between employers, government and individuals. The conference culminated with a call to help rebuild citizens’ confidence that governments can and will fulfill their commitments if necessary steps are taken sooner rather than later.
Partnering with the UK Department for Work and Pensions, the British Embassy in the United States, and the Employee Benefit Research Institute, we convened the second US-UK Dialogue on Pensions, which brought together leaders and experts to compare possible solutions to common pensions and dissavings problems in the two countries.
While critically important, the topic of financial security in retirement has not been the only issue that has occupied AARP’s Global Aging Program in 2005. We released research and hosted programs to explore views on topics ranging from healthcare and long-term care to the concept of livable communities. Closely following the US prescription drug importation debate, we released research and convened a forum looking at how drugs are imported across borders in Europe, how safety issues are dealt with in Europe and Canada, and what the implications could be on costs in the US and the safety of our pharmaceutical system. Last June, we hosted a conference titled Universal Village – Livable Communities for the 21st Century, which examined best practices from around the world on housing and transportation policy and urban design strategies for making our communities more livable for an aging population. In October, we released landmark research and hosted an International Forum on Long-Term Care. The session gathered government leaders, care providers, and recruiters from developed and developing countries to explore the dramatic increase in global workforce migration due to shortages in the long-term care systems, and implications on the quality of care.
The debate on global aging in 2005 reminds us that national possibilities for our aging populations are tempered by our specific national identities, politics and priorities. All that we admire in one country may not be feasible in others, even as we share the same challenges and opportunities. But the key remains to explore successful and failed options together; to do so in a partnership between governments and stakeholders; and to put the power of our creativity and compassion to use in ensuring we all have societies built for all generations.
LM