Introduction
Ageing in the population is constituted by the movement of the population of a country towards advanced ages. Ageing results from two closely related demographic occurrences: Declining fertility and a rise in the life expectancy of the population. When the fertility rate declines, the number of the young people declines while that of the old people increases, (Jill C., 2000).
On the other hand, a raise in life expectancy increases the years that every person is old in relation to the years that the person is young. The increasing population of people aged over 65 years is expected to have effects on the social policies.
The effects of ageing population on social policies
The ageing population has considerable effects on the economy in the sense that older people have more accumulated savings compared to the young people though they may spend less of their savings on consumer goods, (Mark R. et. al.2000). This population may hence cause lower rates of interest resulting to the economic advantage of lower inflation.
The increase in the ageing population however increases some expenditure like healthcare and education. The cost of health care rises as this population increases. The government is left with hard choices on reducing its expenditure by either increasing taxes or reducing its role in the provision of health care to its citizens, (United Nations Development Program, 2005).
The expenditure of the government in education reduces with an increase in the ageing population. This is especially so because there would be a high demand for workforce in the labor market so fewer young people would prefer to join tertially institutions, (Weil, David N., 1997).
There are resulting problems in social systems with an increase in the ageing population. It becomes quite difficult to sustain such a system with a very large number of the aged people, (United Nations, 2004). The pension benefit systems are having problems with sustainability as a result of increased longevity.
The addition of the pension period was not matched with an extension in the period of active labor or even an increase in the contributions of pension, (Gavrilov L., Heuveline P., 2005). This has resulted to a decline in the replacement ratios. Recently, many countries have had to adopt policies that will enable them to make stronger, the fiscal sustainability of their pension systems. Despite these efforts, the challenges of adequacy in pensions still remain an issue of concern.
Conclusion
There has been a general decline in the fertility rate in the past century that has resulted to an increasing population of the people aged above sixty five years in the most developed nations of the world today. Since most of these nations have been under going faster transitions in fertility, they will have a higher rate of population ageing than the countries that are currently developing.
This then implies that they will have to adjust their social policies in order to cope with this population as well as the effects of having a high number of people aged above sixty five years.
References
Gavrilov L., Heuveline P., (2005); Aging of Population, Institute of Management, Washington, U.S.
Jill C., (2000); Myths and the fear of an ageing population Oxford, Oxford press.
Mark R. et. al. (2000); Handbook of Population and Family Economics, New York: Elsevier.
United Nations Development Program; Human Development Report 2005, United Nations Development Program.
United Nations; World Population Prospects: The 2004 Revision Population Database, Population Division.
Weil, David N., (1997); The Economics of Population Aging Prentice Hall, New York.