The longevity revolution could bankrupt European countries such as France, Germany, Spain and Italy to the tune of 200% of annual GDP by 2050, according to Peter Jeffreys, managing director of Standard & Poor's index services for Europe.
Jeffreys said that people were tending to live longer, resulting in more years between death and the general retirement age of 65. He explained that the axis representing the number of people retiring at 65 and the axis representing a greater life expectancy for Europeans would eventually meet in 2050, resulting in countries finding it difficult to fund pension schemes.
Chairman of the National Association of Pension Funds (NAPF) Peter Thompson recently said that UK companies were at risk of being unable to deliver on increasingly unaffordable pension schemes. He explained that a greater life expectancy, the reduction of long term interest rates, and equity performance over the last 25 years have had a detrimental effect on the affordability of pension schemes.
He told IPN that the NAPF should create a greater awareness on life expectancy issues amongst bodies such as the UK government, the Association of British Insurers (ABI), the Association of Consulting Actuaries (ACA), and other employer-forums.
By Janet Du Chenne
The proposed cold-calling ban may be ineffective if a collaborative regulatory approach between the UK and the European Union (EU) is not maintained post-Brexit, the Pensions Management Institute (PMI) has warned.
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