There is no doubt population ageing will result in an increased demand for acute and primary health care, adding to the financial strain of coping with long-term and social care. In the developing world, help with meeting this need is available through the social pension, a policy advocated by the winner of the 2012 Hilton Humanitarian Prize, HelpAge International. Government-funded, regular cash income paid to all older people as their right is both a powerful and cost-effective way of empowering older people and reducing poverty. ….
At present, only 1 in 5 older people worldwide receive a pension. Yet, if the age at which the pension is first paid is chosen to reflect fiscal as well as social realities, the cost of providing coverage to more people is surprisingly small. A universal social pension would cost less than 3 per cent of GDP in most of the countries in Sub Saharan Africa.
Peter Diamond, “The Grey Tsunami: How to Reap a Healthy Longevity Dividend“, New Statesman, 4 April 2012.
MIT economist Peter Diamond (born 1940)was awarded the Nobel Prize in economics in 2010. For much of his professional career, he has focused on the analysis of the US contributory public pension system, known as “Social Security”. In recent work with LSE economist Nicholas Barr, he recommended a Universal Minimum Pension for China. (Barr and Diamond refer to their preferred option as a “citizen’s pension”.)