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Long Retirement Costly To Government


Raising the retirement age solves a fiscal problem facing government with increasing numbers of Canadians retiring, but it does not solve the political or social problems, says Malcolm Hamilton, of Mercer. Speaking on ‘Longevity Risk and Retirement Age’ at the ‘Eighth International Longevity Risk and Capital Markets Solutions Conference,’ he said you can't expect people to work past a certain age as there is no relationship between the age at which people die and the age at which they can reasonably expect to work. So while life expectancy may increase, the age people can work to may not. He said the focus has shifted from what can be done to make lives better which overlooked how to make retirement affordable, to now only looking at how to make it affordable, and not addressing quality of life issues. The dilemma is that government doesn't care if Canadians live longer. It just doesn't want them to have a long retirement as retirement is when Canadians go from paying for government to spending by government because working Canadians pay more for the benefits they receive than retirees do. However, it doesn’t accomplish much if “we expect people to work longer and they end up unemployed or on disability.”

Courtesy of Benefits and Pensions Monitor website News Alerts

 

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