1887

OECD Economics Department Working Papers

Working papers from the Economics Department of the OECD that cover the full range of the Department’s work including the economic situation, policy analysis and projections; fiscal policy, public expenditure and taxation; and structural issues including ageing, growth and productivity, migration, environment, human capital, housing, trade and investment, labour markets, regulatory reform, competition, health, and other issues.

The views expressed in these papers are those of the author(s) and do not necessarily reflect those of the OECD or of the governments of its member countries.

English, French

Coping with Population Ageing in Australia

As in other OECD countries Australia’s population is ageing progressively. On unchanged policies, this will increase government outlays for public pensions and health care, causing a deterioration in budget balances, and reduce economic growth (mainly by lowering growth in the labour force). Nevertheless, the prospective deterioration in Australia’s budget finances is much less than in most other OECD countries because the government only provides the first pillar of retirement income arrangements and means tests this age pension. Moreover, superannuation (private pension fund) benefits are growing, reducing entitlements to the age pension. Even so, the budget costs of population ageing could be lowered by reducing the scope for early retirees to draw on superannuation savings and by requiring individuals to prefund part of the costs of long-term aged care. But the greatest challenge facing Australia policy makers in reducing the costs of population ageing is to roll back the trend ...

English

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