Young people face burden of UK's ageing society, Lords report warns

LONDON - A House of Lords Economic Affairs Committee says the UK's ageing population will place the heaviest burden on young people, who will need to plan to work longer and save more from an earlier age. The committee's report warns that successive governments have failed to ground policy in the financial and societal challenges posed by an ageing society, and that the crisis in adult social care remains a scandal that requires urgent action.

Committee chair Lord Wood of Anfield told BBC Radio 4's Today programme that it has been a struggle to find where in government there is focus on ageing and the transformational effects it will have on people, adding, "Ageing is something that we're just watching happening" and that adaptation is the way forward.

The report says attempts to address demographic pressures through measures such as raising the state pension age or increasing immigration are not adequate on their own. It argues that bringing more people in their 50s and 60s into or back into work is key, and that the government must prioritise incentives to do so. It also notes that an ageing population will demand more care workers, potentially pulling labor from other sectors and creating broader economic tensions.

There is "widespread ignorance" about how much retirement costs, the committee found, and it called for an education campaign. It also said Parliament should examine whether the UK's financial services sector is prepared to support an ageing population. Lord Wood said the government and financial services industry should devise "more innovative ways of getting younger people to think about lives frankly they can't conceive of at the moment - when they're in their eighties and early nineties."

"There's a long time for them to be financially planning for at a time when we know young people are doing less financial planning," he added. The report warned that raising the state pension age would save the government money but increase pensioner poverty for many who have already left the workforce by their sixties and called it a "red herring." To successfully confront this challenge, the committee said, the approach to financial management for today's and tomorrow's young people will have to change.