The UK Government’s Office of Budget Responsibility’s first annual “Fiscal Sustainability Report” was published this week.   The Report has warned that government debt will reach 100% of GDP by 2058 as a result of demographic changes within the population.

17% of the UK’s population is currently over 65, expected to rise to 26% by 2061.  The effect is likely to be particularly acute in Scotland which has received lower numbers of immigrants than England making the country’s age profile even older; the care costs associated with an ageing population here are expected to rise by 74% by 2031.

Two comments sum up nicely the debate that is currently ongoing on this issue.

“David Kern, chief economist at the British Chambers of Commerce, said: “Only greater productivity and higher growth in the private sector can pay for public-sector services and public-sector pensions in the future.”

“Michelle Mitchell, Age UK charity director, said: “If we plan sensibly and carefully calibrate long-term spending and taxation decisions, there is no need for national debt to increase alongside life expectancy.”

The report can be found here.

An article from the Scotsman on this issue can be found here.