The UK pension system faces a dreaded 'double hit' as the nation's population ages rapidly, according to new figures from the Office for National Statistics (ONS). The number of people aged 85 and over is projected to double over the next 25 years, placing significant strain on the Department for Work and Pensions (DWP) system.
Key Statistics from ONS Data
The data reveals that there were 1.75 million people aged 85 and over in mid-2024, accounting for 2.5 per cent of the population. This figure is expected to rise to 3.6 million, or 4.9 per cent, by mid-2049. Over the same period, the number of people of pensionable age is projected to increase from 12.4 million to 15.3 million, driven by longer life expectancy, the ageing of larger cohorts born in the 1960s, and lower birth rates.
Demographic Drag Warning
Maike Currie, VP personal finance at PensionBee, warned that the UK's demographic dividend is turning into a 'deepening demographic drag'. Commenting on the projections to 2034, Currie noted: 'From mid-2026, deaths will outnumber births, leaving 450,000 more deaths than births by 2034. Population growth now relies entirely on migration.'
She added: 'The age shift is stark: between mid-2024 and mid-2034, the number of people of pensionable age is set to rise by 1.8 million to 14.2 million - that's around one in five of the population, taking into account the planned increase in the state pension age to 67. Meanwhile, over the same period, the number of children is expected to fall from 12.6 million to 11 million, making up just 15.5 per cent of the population by mid-2034.'
Double Hit on Pension System
Currie continued: 'For the pension system, this means fewer future workers supporting more retirees. With earlier figures showing a third of those leaving the UK, aged 16 to 34, the pension system faces a double hit: fewer contributors and more retirees, putting real strain on the state pension and long-term investment flows.'
This warning comes as the DWP system grapples with an ageing population, raising concerns about the sustainability of state pensions and the need for policy adjustments to ensure long-term viability.
