Embed Size (px)
DESCRIPTION
We held an event to launch SOS 2020, supported by Aviva and Ernst and Young. This event was kindly sponsored by the Institute and Faculty of Actuaries (IFoA). Last week the OBR Fiscal Sustainability Report noted that "public finances are likely to come under pressure over the longer term, primarily as the result of an ageing population. Under our definition of unchanged policy, the Government would end up having to spend more as a share of national income on age-related items such as pensions and health care, but the same demographic trends would leave government revenues roughly stable." But whilst there is greater awareness of the fiscal challenges of ageing, there has been little progress in addressing an overarching plan to address the challenges. ILC-UK is launching SOS 2020 to begin to identify costed solutions to the fiscal challenges of ageing. The House of Lords Select Committee on Public Service and Demographic Change, in its 2013 report “Ready for Ageing”, began by saying “the UK population is ageing rapidly, but we have concluded that the Government and our society are woefully underprepared.” SOS 2020 is a major new programme of work led by ILC-UK which will raise awareness of the need to adapt our economy and society to the big strategic challenges posed by an ageing population. SOS 2020 will outline the specific policy measures needed to achieve this goal. It will illuminate the issues that face us and develop fully considered and costed solutions that will act as a “call to action” to policy-makers and politicians. Above all SOS 2020 aims to raise national and international awareness of problems and possible solutions in which we all have a vested interest. In an increasingly interdependent world, there is a need to look beyond national shores for arguably collective consensus and joint solutions. SOS 2020 will give us the opportunity to do this. ILC-UK launched SOS 2020 with specific projects exploring retirement income sustainability and healthcare sustainability. This launch event gave delegates an opportunity to feed in their thoughts on how to ensure our public policy maximises the opportunities of our ageing society.
Citation preview
Sustainable Older Society 2020 (SOS 2020)
Wednesday 23rd July 2014
This event is kindly sponsored by
#SOS2020
Welcome
Baroness Sally GreengrossChief Executive
ILC-UK
This event is kindly sponsored by
#SOS2020
Trevor LlanwarneGovernment Actuary
Government Actuary’s Department
This event is kindly sponsored by
#SOS2020
Healthcare Sustainability
This event is kindly sponsored by
#SOS2020
Lawrence ChurchillTrustee ILC-UK
This event is kindly sponsored by
#SOS2020
Indicative Statistics Present/ C.2050 %
Recent past Increase
• World % of over 60’s 10% 20% 100%
• Older people needing care 101m 277m 174%
• People with dementia 44m 135m 207%
• % of UK GDP (Health, Pensions, 13% 19% 46%Social care)
Potential Vision• “A (global) society, which maximises good health
throughout the life course, which has mastered preventable diseases & where health care systems
– Are efficient– Publicise outcomes– Are accessible to all citizens at all times– Minimise rationing– Have tariffs for usage which command wide
support – Continue to evolve to changing demands”
Shaun CrawfordGlobal Insurance Sector Leader
Ernst & Young
This event is kindly sponsored by
#SOS2020
Julian Le GrandChairman, LSE Health and Social Care
LSE
This event is kindly sponsored by
#SOS2020
Tom KennyPartnership, representing the Institute and Faculty of
Actuaries
This event is kindly sponsored by
#SOS2020
Sustainable care
Caring for an ageing population
12
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
2024
2026
2028
2030
2032
2034
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
% of popula-tion age 85 and over
% of popula-tion age 65 and over
• UK number aged 65+ is expected to increase by more than 50% in the next 20 years
• Aged 85+ expected to more than double in the same period
• Wide variations in life expectancies and probability of needing care between males and females
• Variation by geographical region in life expectancy and morbidity
• Incidences of dementia (moderate or severe cognitive impairment) are rising
Background to social care changes
• Background to social care changes– Timeline – Care Act - Consultation
– Cap
– Different costs (hotel, LA rate, top-up)
– New means test limits – (£17k to 27k/118k)
– Other changes
• Recent budget announcement– Facilitate product innovation
– Concern of pension funds being exhausted before needing LTC
What is sustainable care?
• Sustainable = greater self funding?
• Greater self funding can be achieved by – Increasing awareness of
• long term care costs
• longevity risk at retirement
• financial options for providing an income in retirement including meeting care costs
– Product innovation
– Tax incentives to encourage saving
So
cial
car
e
Summary of findings from IFoA paper
• Need greater saving into pensions
• Pensions Bill
• Significant proportion of retirees will need LTC
• Most people who need LTC will not benefit from the cap
• Benefit of cap and personal costs vary significantly by region
• Range of pension products that could support LTC
• Communication
• Regulatory and tax changes
North Ea
st
North W
est
Yorks
hire &
the H
umber
East
Midlands
West
Midlan
ds
East
of Engla
nd
London
South Ea
st
South W
est
Engla
nd0
5
10
15
20
25
£0
£50,000
£100,000
£150,000
£200,000
£250,000
£300,000
£350,000
5.7 6.1 6.4 5.6 6
4.53.9
3.44
4.7
9
7 6
9
7
14
18
22
17
13
Personal Funding of Care Costs by Region in England from 2016Care Home with Nursing - 85 at entry into Care
Personal Funding required before the Cap is reachedPersonal Funding for the remainder of the 10 year period Years before Cap is reachedPercentage probability of surviving to when the Cap is reached
Care
Cos
ts b
efor
e an
d aft
er th
e ca
p is
reac
hed
Probabilty of reaching the cap
(%)
Years before cap is reached
What do we need to know?
• We need greater sharing of social care cost data by local authorities
• We need to understand how technology will impact care
• We need to understand how medical advances will affect the ageing society
• We need to know how local authority rates will change under the new regime – will the gap between LA rates and care costs reduce? How will top-up of care costs affect this?
What do we need to do?
• Stable social care regime to provide foundation for greater product development
• Create an effective information and advice process to encourage greater saving and informed pensions decisions at retirement
• Technical changes to support product development
Eppu Mikkonen-JeanneretHead of Policy
Helpage International
This event is kindly sponsored by
#SOS2020
Discussion and Q&A
This event is kindly sponsored by
#SOS2020
Retirement Income Sustainability
This event is kindly sponsored by
#SOS2020
Ben FranklinResearch Fellow
ILC-UK
This event is kindly sponsored by
#SOS2020
Health Long-term care State pensions Pensioner benefits Total age-related spending0
5
10
15
20
25
30
6.4
1.2
5.5
0.8
20.4
7.5
1.7
6.7
0.9
23.0
8.5
2.3
7.9
0.9
25.1
OBR spending projections as % of UK GDP
2018-19 2033-34 2063-64
Source: OBR 2014 Fiscal Sustainability Report
Per
cent
of
GD
P
80
90
100
110
120
130
140
150
160
170
180
HistoricMar-14Dec-13Mar-13L
iabi
litie
s to
inco
me
ratio
Source: ONS, OBR and author's calcula-tions
Debt to income: Actual and projections (various OBR forecasts)
Clive BoltonManaging Director, Retirement Solutions
Aviva UK Life
This event is kindly sponsored by
#SOS2020
Mick McAteer
This event is kindly sponsored by
#SOS2020
Jane VassHead of Public Policy
Age UK
This event is kindly sponsored by
#SOS2020
Discussion and Q&A
This event is kindly sponsored by
#SOS2020
Sustainable Older Society 2020 (SOS 2020)
Wednesday 23rd July 2014
This event is kindly sponsored by
#SOS2020
