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Warning over ageing population repeated

Young talent will flee Bermuda to find opportunities in other countries if the island's population trends are not dealt with, a political commentator has warned.

Denis Pitcher was speaking after a recent population projections report highlighted that the number of elderly people was expected to rise, but the overall population would fall between 2016 and 2026.

Mr Pitcher said: “We desperately need to increase our working population or risk the fallout that will occur if we don't.

“This includes recognising that we will face an exodus of talented youth who are burdened with ever higher costs and lack of prospects for a prosperous future, who will ultimately seek options elsewhere.”

He explained that the report showed that eight people were in the working age group of 15 to 64 years old for every two retirees over 65 in 2016.

But there is expected to be only five people of working age for every two retirees by 2026.

Mr Pitcher said: “Our healthcare and pension systems are sustained based upon the balance of working people to retirees.

“Working age people's pension contributions are effectively paid out to retirees.

“The fewer people of working age versus the greater people of retirement age means there will be far fewer dollars going into the pension system than there are going out.

“This is not sustainable and means our pension system will fail unless we significantly raise contributions, significantly cut payouts, substantially increase the working population or some combination of the three.”

He added: “Similarly, working age people tend to be healthier and their health insurance contributions tend to offset the contributions of retirees with significantly higher health issues.

“The more retirees we have versus the fewer workers, the greater the burden on our healthcare system. Overall healthcare costs will rise substantially.

“Again, this is not sustainable and will mean our healthcare system will be reliant on significantly raising insurance rates, cutting benefits and costs, substantially increasing our working population or some combination of the three.”

The independent observer outlined a series of measures that should be looked at to make sure pension and health insurance contributions met the island's growing needs.

The population projections report showed the old-age dependency ratio, which measures the ability of working-age people to support seniors, was expected to jump from 24.7 over-65s to every 100 people aged between 15 and 64 to almost 40 elderly people to every 100 people in the working-age bracket over the decade looked at.

It was also predicted Bermuda's overall population will drop over the same timeframe as the demographic profile shifted towards fewer children, an older workforce and more seniors.

Lovitta Foggo, the Government reform minister, said last week that the report highlighted some “critical realities for Bermuda's future population” and solutions were being sought.

She said pension funds were closely monitored and consideration was being given to raising the retirement age to 67.

Ms Foggo added: “Similar reforms will be made to our Social Insurance scheme.”

A spokeswoman for the Ministry of Health said it “understands how population and demographic trends impact health costs and insurance premiums” but individuals can play a part to help.

She explained: “Annual actuarial reviews of our plans take into consideration these trends and future projections.

“But the size of the population is not the only factor affecting costs and premiums. Other factors include, for example, the level of ill health, access to care at the appropriate level and time, and how much services are used.

“The ageing of our population is a serious consideration, which highlights the pressing need for persons to adopt healthy lifestyles to avoid chronic diseases, which put more burden on individuals and the system prematurely and with age.

“Healthier lifestyles contribute to easing pressure on health costs and premiums.”

Youth talent drain: Denis Pitcher, political commentator

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Published October 25, 2018 at 9:00 am (Updated October 25, 2018 at 10:29 am)

Warning over ageing population repeated

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