Challenges to be addressed
Countries in Europe and North America are experiencing an important demographic
transformation: the unprecedented ageing of the population. By 2050 every
third person in the region is expected to be at or over the age of 60. This
demographic development will have an impact on all aspects of economic and
social developments and therefore must be adequately addressed by governments,
the corporate sector and NGOs. The collaboration of all relevant stakeholders
is vital to effective policy responses to population ageing. I congratulate
the organizers that succeeded in organizing this event in which all key players
are participating: government represented by the Federal Minister for Family
Affairs, Senior Citizens, Women and Youth and the Federal Minister for Economics
and Technology, the corporate sector represented by the Confederation of German
Employers Associations and the Association of German Chambers of Industry
and Commerce and the German Industry Association, and civil society represented
by the German Trade Union Federation and Humboldt University.
Each of the stakeholders has an important role to play: Governments in mainstreaming
ageing in all policy fields: economic and budget and tax policies, social
and employment policies, housing, health and education policies. Governments
must ensure that the policies are properly coordinated and that short-term
policy is well linked to long-term perspective objectives.
The business sector is expected to respond in fields like the labour market
and employment, corporate social responsibility, and adjusting production
to changing demand, etc.
Trade Unions have a role to play in better representing the interests of
workers and being involved with NGOs involved in discussions on pension reform,
labour market reform, etc., or contributing to fields such as increased employability
of older persons, etc.
Despite the different roles of stakeholders, it is only through partnership
among all of them that commitments like ensuring full integration and participation
of older persons in society or ensuring quality of life for all ages can be
achieved.
Governments must make commitments
In order to address population ageing, governments must make commitments
at national and/or international levels. If the Regional Implementation Strategy
(RIS) consisting of 10 principles is agreed tomorrow, it will assist the governments
in adopting or amending existing national strategies with embodied strong
commitments
(1) in the human rights area for example combating social isolation and
marginalization of older persons, combating discrimination of elderly men
and women in the workforce and in recruitment, ensuring the right to education
in older age, ensuring right to adequate housing, access to health, etc.
(2) in the area of economic development, such as the increased participation
of older persons in economic life through employment, participation in the
care of family members, unpaid work for the community, etc.
Commitments must be followed by the formulation of comprehensive policy that
includes well defined targets and measures to achieve and ensure monitoring
of the implementation.
Governments need courage
The primary responsibility in the development of effective policy responses
to population ageing belongs to the government. Governments need to have the
courage to deal with the population-ageing agenda, namely to take decisions
which in the short-term might have some politically damaging implications.
Depending on disparities in the region this might include the courage to increase
the pension eligibility age, (in transition economies), to lower the income
replacement rate of statutory pension insurance (in some developed countries),
to develop multipillar pension insurance which in most cases requires increases
in the contribution rate. Complementing pay-as-you-go pension insurance by
capital funded retirement provisions including pension funds gives existence
to a new industry which should be encouraged but at the same time regulated
in order to provide adequate protection to thousands of individual investors
and to prevent pension-fund crises such as those in the US initiated by ENRON´s
case which is a threat to the pension industry itself as it undermines investors'
confidence.
The recently adopted EU Pension Fund directive which allows cross-border
activities of the pension industry will no doubt boost the pension industry
in the EU. This should further stimulate on-going discussions in the EU on
reform of the regulatory framework of the market for financial services both
at national and international levels. The enlargement of the EU from 2004
will gradually provide an opportunity for further expansion of the pension
industry in this region.
Sustainable growth and development
Effective addressing of population ageing requires the achievement of higher
rates of economic growth and its sustainability. This is true for all States
in the region - both developed and developing. Rates of economic growth are
needed that would ensure
(1) fiscal sustainability of social protection of old people
(2) employment of older persons without a negative impact on the employment
of younger generations
Sustainable development must be achieved in order to ensure social sustainability
with respect to older persons. Social sustainability with respect to older
persons aims to prevent social and health degradation of older persons and
their full integration into society.
Markets fail to ensure a fully inclusive society; it is the role of Governments,
business and NGOs to repair this failure through different policies like social
and housing policies, pricing policies, etc. In some economies we witness
an important role of the corporate sector in providing affordable access to
utility services like transportation, energy, water for older people. This
policy is often accompanied by the government's efforts to provide incentives
either by subsidies or tax exemptions (less preferable). It is clear that
the above policies must not violate economic fundamentals and reduce the competitiveness
of the business sector considerably.
Labour market
Older people due to their improved access to health and better environment
are physically younger if compared to people of the same age 50 - 100 years
ago. In order to be younger in terms of labour productivity, the training
of older persons has to be improved. Education should be life-long, ensuring
that our knowledge and skills are continually upgraded as we age. This should
include "second literacy" - training in ICT. For elderly persons
training programmes should be organized. In eliminating age barriers in skills
and knowledge the combined efforts of governments at different levels, trade
unions, civil society and business are needed.
Nevertheless the responsibility of governments to develop appropriate labour
market policies to respond to population ageing is a key to success. It requires
a comprehensive approach including demand-side and supply-side policies (i.e.
education and health policies, housing and transport policies, government
employment schemes etc).
Ageing and business
Business with respect to the labour market and ageing has a considerable
role to play: business should be more involved in providing more flexibility
in employment schemes: like part-time jobs, temporary employment etc, and
be active in re-training, etc.
Globalization is accompanied by growing competition and the business sector
must increase its effort in order to cope with it. In this environment companies
are forced to minimize their social expenditure, resist complying with ILO
conventions, etc. Therefore it is important that a commitment to the international
framework of corporate social responsibility is made at the global level.
Nevertheless governments have so far failed to make such a commitment at the
global level. Various initiatives of business in social responsibility, in
social reporting, etc. all over the world might pave the way to breaking the
resistance of many governments in this field.
Population ageing is a big opportunity for business: it might boost the pension
industry, industries responding to the changing demand for goods for older
men and women, respond to demands for environmentally friendly production
patterns, etc.
Role of international organizations
Finally I would like to stress the role of international organizations in
addressing population ageing. The role of international organizations is to
stimulate governments to take commitments to address ageing, to provide policy
advice, to assist national institutions to implement policies and to monitor
them, to provide a forum for the exchange of best practices, to promote cooperation
among the member States, etc.
In concluding: the task to respond to population ageing is enormous and requires
a comprehensive, well targeted and coordinated approach of all stakeholders.
If well defined and implemented it might ensure a win-win situation across
generations, may ensure economic efficiency and social inclusiveness at the
same time. This is our goal.
Thank you.
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