Issues Magazine

Population Ageing

By Derryn Wilson

Population ageing presents both new challenges and opportunities for governments and communities. It is a global phenomenon, but local areas and nations are at different stages and much is to be learnt from sharing experiences.

Australia’s total population is projected to increase over the next few decades, raising debate about the optimal population size for environmental sustainability, the economy, and the demand and capacity of infrastructure, housing and services. However, the structure as well as size of the population is also changing. Australia is experiencing demographic ageing – moving from a relatively young society to one where the proportion of older people aged 65 years and over will increase from 13% in 2010 to 23% by 2050. Both increases in longevity and sustained low birth rates contribute to population ageing.

Within the older population, the number of very old people (85 years and over) is expected to more than quadruple from 0.4 million people today to 1.8 million in 2050. In the past two decades there has been a 206% increase in the number of people reaching 100 years and more (see Census data, www.abs.gov.au). Rates of functional disability increase with advanced age and thus it is this group of older people who have the greatest need for health and support services. Other structural variations occur because women outlive men at the older age groups and cultural backgrounds vary across ages based on migration history.

In recent years the Australian government’s Treasury Department has produced a series of reports examining the implications of an ageing population and outlining the ameliorating actions governments need to take now and in the future to best manage the changes. According to the 2010 Inter­generational Report:

Population ageing will mean that there will be fewer workers to support retirees and young dependants. This will place pressure on the economic growth that drives rising living standards. At the same time, the ageing population will result in substantial fiscal pressures from increased demand for government services and rising health costs.

Australian Treasury, Australia to 2050: Future Challenges, 2010

Both the average number of hours worked and the number of people in the workforce are expected to decline. In 1970, there were 7.5 working-age people for each person aged over 65 years. By 2010 this has dropped to an estimated five people of working age for every person aged 65 and over, and by 2050 it is projected to be 2.7 people of working age for every person aged 65 and over.

The other concern is for the increased demand for and cost of health care and other age-related government expenditures.

Population ageing will increase spending on health, age-related pensions and aged care. Escalating health costs associated with technological enhancements, such as new medicines, and increasing demand for higher quality services, will add to fiscal pressures from ageing.

Today, around a quarter of total spending is directed to health, age-related pensions and aged care. This is expected to rise to around half by 2049–50.

From 2009–10 to 2049–50, real health spending on those aged over 65 years is expected to increase around sevenfold. Over the same period, real spending on those aged over 85 years is expected to increase around twelve-fold.
Australian Treasury, Australia to 2050: Future Challenges, 2010

The 2010 Intergenerational Report thus focuses on the range of government actions considered necessary to manage the balance between increased expenditure demand and a lower revenue base, such as improving productivity in the economy, taxation and superannuation reform and health reforms to improve efficiencies.

The National Health and Hospital Reform Commission’s final report, A Healthier Future for All Australians (June 2009), also makes a number of recommendations about reforms to the aged care service system to achieve better integration for aged people accessing the primary health, hospital and aged care systems, more subacute care beds and greater choice and flexibility in residential and community care options. Some of these recommendations were taken up and agreed to at the Council of Australian Governments meeting in April 2010. Others will be further examined through the Productivity Commission’s inquiry in aged care, to be conducted during 2010.

Although there are challenges, it would be wrong to frame the implications of demographic ageing simply in catastrophic terms or as a problem for Australia. Many parts of Australia and other countries have already experienced the degree of population ageing that Australia overall is expecting over the next four decades. South Australia and Tasmania have higher than the national average of population aged 65 years and over. Communities such as Bribie Island in Queensland and Victor Harbour in South Australia already have nearly 30% of their populations aged over 65 years. In general, Australia’s rural and south-east coastal areas have higher proportions of older people than metropolitan areas.

Globally it is the older population that is growing fastest, and by mid-century those over 60 years are expected to outnumber children aged under 14 years for the first time in history.

The World Health Organisation has identified population ageing as one of humanity’s greatest triumphs because it represents incredible achievements in health outcomes and improved life expectancy over the past decades. Australia currently has one of the highest life expectancy rates in the world.

According to United Nations estimates, Australia has the joint fourth-highest life expectancy in the world (along with Switzerland) over the period 2005–10 when ranked by male life expectancy. Only Iceland, Japan and Hong Kong have higher male life expectancy than Australia. Australia also has the joint third-highest female life expectancy. Like in most countries, female life expectancy is higher than male life expectancy in Australia.
Australian Government Australian Institute of Health and Welfare (http://www.aihw.gov.au/mortality/life_expectancy/compares.cfm)

Life expectancy for Australian females born today is 84 years, while for men it is 79 years. Although much of the gain in life expectancy rates in the 20th century was due to the reduction in infectious diseases (which allowed more children to live to old age) and higher standards of living, including diet, sanitation, healthcare and public health campaigns, life expectancy rates can go up or down and vary across subpopulations. Increasing rates of chronic disease such as diabetes among older people, and increase in risk factors like obesity, may reduce life expectancy rates. According to Philipa Cotter and colleagues (in Longevity and Social Change in Australia, 2007), indigenous Australians have a much lower life expectancy, experience the burden of age-related diseases at a much younger age and have a relatively larger young population than other Australians.

With increased longevity and the resultant growth in the size of older populations as a global phenomenon, many of the national actions are consistent with an international approach. The United Nations first adopted an International Plan of Action on Ageing in 1982, and developed a set of Principles for Older People in 1991. These are underpinning value statements about what should be universally available to older people in the areas of independence, participation, care, self-fulfilment and dignity. A second International Plan of Action on Ageing was adopted in Madrid in 2002.

At a recent International Federation on Ageing conference held in Melbourne in May 2010, the closing debate focused on the need for a United Nation’s Convention for the rights of older people. The United Nations continues to monitor progress and raise awareness on population ageing, and commissions research and discussion papers. The World Health Organisation produced a Health and Ageing Discussion Paper in 2001 and has been promoting an Active Ageing policy framework since 2002.

Australia is a signatory to the UN Action Plans on Ageing, and in 2001 the Commonwealth government produced the National Strategy for an Ageing Australia. The strategy provided a framework for a national response to the challenges and opportunities that an older Australia will present. It was structured around four key areas: independence and self-provision; attitude, lifestyle and community support; healthy ageing; and world-class care.

State and territory governments have also produced ageing strategy documents. For example, in 1997 the Victorian Parliament’s Inquiry into Planning for Positive Ageing was followed in 2002 with Making This the Age to Be: Forward Agenda for Senior Victorians. Queensland, South Australia and Western Australia have also produced similar strategies.

In response to concerns expressed by many councils, the Australian Local Government Association developed the Population Ageing Action Plan 2004–208. Councils across Australia have progressively begun to consider the impact and needs of their ageing populations and develop and incorporate strategies that link to state plans and a range of local responsibilities.

In NSW, for example, local government is involved in a partnership that is developing a web resource to help councils in NSW plan for the care of the ageing population. The Local Government and Shires Associations of NSW is working with the Division of Local Government and the Office for Ageing to develop the resource. It is designed to help councils to prepare long-term strategic plans that include measures to address the ageing population trend. The resource also aims to encourage social planning and community development initiatives to promote formal and informal community networks for all ages and to sustain intergenerational communities. It is an element of the Towards 2030: Planning for Our Changing Population initiative, a whole-of-government strategy to actively plan for the ageing of the NSW population (http://www.dadhc.nsw.gov.au/dadhc/Publications+and+policies/).

In Victoria, a project partnership for 2005–08 between the Office of Senior Victorians in the Department of Planning and Community Development, the Council on the Ageing and the Municipal Association of Victoria resourced and supported councils to plan for their ageing populations and encourage more “age-friendly” communities. All but seven of the smaller councils in Victoria utilised this opportunity to develop or revise their Positive Ageing plans. This involved many older people, service providers and local businesses, with a wide range of actions to encourage more age-supportive urban environments, participation and healthy ageing specific to the priorities identified in each local area.

As part of this project, one of the municipalities in Melbourne (and one in Perth) participated with 33 other cities around the world in the Global Age – Friendly Cities project, which builds on the World Health Organisation’s Active Ageing framework. It acknowledges not only the increasing ageing of populations but the increasing rate of urbanisation – by 2030, three in every five people in the world will live in cities. The project used a focus group methodology to have conversations with older people and those associated with them (carers, service providers) to identify common features of the urban environment and urban life that are more or less enabling and supportive for an older person. This data has been developed into a checklist that can be used to assist cities in self-assessing and mapping their cities’ progress in “age-friendliness”.

Thus, population ageing is a local, national and international issue, with much to be learnt from partnerships and shared experiences. Each level of government in Australia is planning and responding, and working together, on the areas for which they have prime and joint responsibility.

Each era creates different life experiences, opportunities and expectations. Much is being made of the way in which the emerging “baby boomer” generation (those born from 1946 to 1964) will not only be a larger group but also different to the generations of their parents and grandparents in attitudes, resources and expectations, and much more research and survey data on these issues is emerging. There is interest in the degree to which a larger older population will influence the political agenda and whether larger, stronger formal advocacy groups will develop more influence. There is also interest in the degree to which there will be an increase in “social capital”, with older people voluntarily sharing skills and resources in their communities and new markets for leisure, lifestyle and accommodation products.