On Monday afternoon, I came across an old lady sobbing as she scribbled a few loving notes onto a small wooden cross. Seeing that I noticed her, she wiped the tears and tried to pull herself together in true Scottish fashion, quite prim, but stern. She brushed down her pleated tartan skirt and tucked her scarf in around her collar to keep out the vicious north wind, which howled through the Scott Monument at the Garden of Remembrance in the centre of Edinburgh.
Who was she crying for — a son, a husband, a brother or maybe her own father? Where was she when she got the dreaded letter, the phone call or the hand on her shoulder? As she scribbled away lovingly, she was joined by other elderly people who came to remember, to pay respects and to say goodbye again.
These stoic old soldiers with their poppies and their memories were oblivious to the giggling Chinese tourists who clicked their cameras at the old men in kilts.
While the old Scots laid their wreaths and remembered their loved ones, it struck me that the two phenomena on display that blustery Edinburgh afternoon — rich Chinese tourists and elderly western Europeans — will dominate politics in the decades ahead.
In fact, there is a certain historical symmetry between the two phenomena because nowadays the Chinese are doing to America and the West what America did to Britain and Europe after the Second World War: they are buying assets. China is using her economic might to take advantage of an enfeebled America, just as America used its economic might to take advantage of a devastated Europe in 1945.
In many ways, both the old Scots and the young Chinese tourists are testament to the changing world.
We in Ireland can’t escape these trends. A few weeks ago, this column addressed the idea of China buying assets with all the dollars she has accumulated. Now let’s look at the ageing population issue and consider both the problems and the opportunities it might present.
In Ireland, we are getting older and surviving longer. For example, in 1986 the average man lived for 12.6 years after his retirement. By 2006, the average man lived 16.6 years after retirement. This is a 32pc increase in just 20 years. The State’s liability on pensions has also gone the wrong way as the pension age was dropped from 70 to 66 in 1970, when the population dynamics were different.
The thing about paying for our state pension is that it creeps up on you. It is not a thing you have to pay in one lump, rather every year, it just gets that little bit more expensive. The Comptroller and Auditor General’s Report last week calculated that the state pension will cost us â‚¬101bn over the next 50 years.
That’s a big number. Just to put that in perspective, â‚¬101bn is â‚¬230,593 for every hour of every day for the next 50 years just to pay our public sector pensions. So the rest of the workforce has to generate a surplus of â‚¬230,593 every hour for the next 50 years just to pay the pension commitments we have already entered into.
But what are we to do? It’s all very well to talk about pension reform when you are my age because it seems far away. But when I (hopefully) get to 65, I would love to have my full pay and I will be as protective of it and vociferous as I am today about national school funding (because my children go to the local national school). It is only human to realise that your position on all these matters is somewhat jaundiced by whether you benefit from them.
It is clear that the State, particularly as we all get older, will not interfere with pensions. Therefore the shortfall will have to come from more taxation on the young to pay for the old. We did try to address this issue with the National Pension Reserve Fund but extraordinarily the temptation to raid that particular piggybank was succumbed to this year to recapitalise the likes of Anglo Irish Bank. That money is now gone, possibly forever.
While much detail is focused on the state pension and public sector pension, the private sector pension position isn’t much better. Take the privatised Aer Lingus, for example. Last year, the company had to top up its pension by â‚¬29.3m just to keep the thing afloat. This is a huge ongoing liability for the company and the same is true of many companies.
So it’s clear that the average worker from the Pope’s Children generation faces a higher tax bill to pay for those of us older than them, and will be the first generation of Irish people to be poorer on retirement than their parents.
But is there something we can do about it? If all of Europe is getting old, why don’t we invest in geriatric care and make this place the old folks’ home of western Europe? It might sound strange with our climate, but it must be remembered that more elderly people die in the heatwaves of Europe,than ever die of the cold.
By old folks’ home I mean specialising in medicine for elderly people and specialising in the care of the elderly. Ireland has lots of spare housing estates where no one wants to live. We could create retirement villages in many of these empty houses and do deals with the NHS, for example, to look after some of Britain’s burgeoning pensioners.
Big demographic changes always present opportunities as well as threats and the opportunity in geriatric care is enormous, as well as humane.
Strange as it may seem, the next generation of elderly Scots who place poppies in remembrance around this time of year, could present a medical and employment opportunity for thousands of young Irish people who find themselves on the wrong side of the Celtic Tiger binge.
Now I am utterly convinced you have lost the plot! This edict coupled with your credibility eliminating snipes at Lenihan and O’Callaghan are causes for serious concern.
Time to see your analyst perhaps?
ps It is a statistical fact that the vast majority of elderly persons requiring 3rd party care remain within a 10 mile radius of their next of kin, sons or daughters. QED
David – I disagree with the suggestions in your article .The Cote d’Azur in France is full of old europeans ( incl. all of D4 ) where they while away their serenity as they look upon the azur of the mediterranean.The age norm here is 87 . They practice the tango classes with the young in an ageless experience..If you make past that time ( 87 ) you are in the Cheltenham Hurdles .Weather is the factor so is the exceptional infrastructure and health care available locally.Also locals are tempted to stay to age away under their unique napoleonic laws… Read more »
The last thing people do when they reach old age is to emigrate to a strange country .
David , sometimes you really do come out of left field with some mad ideas . Some of them are great but that is not one of them .
How about a centre of private education ? Those rich Chinese just love education .
Can somebody explain Anglo to me ? I am serious .
As far as I can see it does no business yet it has 60 billion on deposit which is not in the safe . So we pay that 60 billion out . What are we hoping for with Anglo ?
Interesting article. But concerning the healthcare sector and opportunities, it seems that the idiots in the government have missed the point. They have cut down on the quantity of trainee nurses. And then as a result instead we have people from other countries coming here to do our nursing, and young Irish kids going abroas to learn. And the blame lies squarely with the Harney agenda of cost cutting in the wrong areas. There is also the fact that many Eastern Europeans who are in our health services will at some stage return home to look after their own parents,… Read more »
:) Maybe we should merge the HSE, NAMA, and FAS into a big massive public sector company for treating old people :)))
Of course the likelihood of being able to sell the idea that any of these organizations have a competence in anything, let alone that they should be looking after the health of the elderly….would be stretching credibility.
And yes, there is now that added headache…..to many houses…too many hotels…too many shops….to many banks….too many offices….etc….
Hi David, You are right that demographic changes are tending towards an older population, but you are wrong that Ireland could become some sort of cente for it. As pointed out old people mainly dont travel (due to family reasons) and those that do travel to warmer holiday-like destinations (eg: Florida in US, Spain, France in Europe …. etc). I expect countries to start increasing the age when pensions apply as people are fitter (or could be) at 65 to 75 and willing and able to work, etc. You and I may think that we could retire at 65 but… Read more »
These off the cuff hare brained shots in the dark on the back of a cigarette packet betray several screws loose and the horror of the empty screen requiring column cms to input into a collapsing print media. How you can put your name of this completely horrifies any reasonable person with the prospect of pure froth issuing from your fingertips at the keyboard, defying anyone to say you have no clothes. You really should try to portray the actual effects of the collapse of hyper-capitalism upon the lives of decent people, whatever their age, in this country.
Giving Europe’s youth unemployment problem – with 50% of young people in Spain looking for a first job for example – the young people of Ireland can expect tough competition. Actually David’s poposition sounds like a business plan for Spain, Italy and Portugal – rather than a business plan for wet and windy Ireland. Though bear in mind that in a hot summer, Ireland is ideally placed to look after the elderly. I am just concerned about the cultural problems – Irish young people tend to more brash, arrogant, overly talkiative, superficial, loud and poor at detial, compared to their… Read more »
I think that we need to concentrate on holding on to what is left of our industrial base and expanding that. But deluded fools like Boil and Coughlan, plus the legacy of Ahernism on our cost infrastructure, has resulted in us being uncompetitive in this sector.
It’s an good idea, but it would work in Ireland. I’m sure everyone knows at least one Irish person who took in an elderly relative or neighbour who was not well, hoping they’d get them to sign over all they had, and then, once they’d signed on the dotted line, hoped they’d die quickly. Country is full or rotten individuals, sorry for being so negative. So many have no morals. I wouldn’t ever want to go into a nursing home in Ireland. I’d fear the level of care I’d receive and I wouldn’t be holding out much hope for protection… Read more »
I think another way to get creative about the demographics issues, would be to concentrate on our strengths. [And less face it healthcare is not one of our strenghths!!!]. i) Health products/Pharma. ii) IT products/services and diagnosis equipment iii) construction of health care facilities along the Med, using Irish construction expertise. There are a lot of nursing homes in Ireland, especially, it would seem in the Midlands. This is a result of favourable tax regimes. This has nothing to do with a core competency in this area-as shown by the Leas Cross incident. [there are rumours going around about other… Read more »
I’m sure there would be opportunities to house the elderly to a certain extent but it only work in particular developments, like hotels built for golfing weekends like mount wolseley or Glasson, which we have in over abundance. I would think we could become a learning centre for the english language where students from all over ireland could come to learn and spend their parents hard earned savings(on our over inflated interest rates). Language schools are already popular hear, especially for kids from Italy and Spain, and Dublin is a fun place for young revellers who could welcomely replace our… Read more »
oops…’from all over europe’…
read todays article with the usual interest.Another use for empty estates in ireland. We are supposedly one of the knowledge economies…instead of filling them with old people why not use all these empty houses as accomodation for foreign students. We should try and utilise our reputation…a common thing you hear is that there is great education in Ireland…why not become the front door for all the people that require education and hope to use this as an entry point into europe.You study in ireland for x amount of years, you pay our colleges and our regional technology colleges or gmits… Read more »
on the education theme, why not get out of work dell workers to tender for computer classes in our primary schools….they can tender to work for x euro an hour, it would have to be cheap as we cant afford to pay much….their hours of work in the primary or secondary schools in the teaching of computers will not affect their ability to get the dole, there will be some type of government incentive for them to do this type of work…..a bit like the tax incentives given for people to build houses….this needs work but may be a start… Read more »
To all our Australian friends:
Aussie twitterers! “Addicted To Money” TV series on the GFC starts tomorrow night ABC 1 – 8.45pm. I hope your enjoy it.
I got that on twitter this morning, from DMcW, in case you want to watch…….
johnm – fantastic idea .well done
[…] Good article from David McWilliams on the public sector pension liability.Â Private sector pensions are also a serious issue with only 54% of people in the private sector providing for their pension (Source: Pensions Board Annual Report 2008). […]
How coincidental to read this article…Was chatting to a friend of mine before I read this article. Said he was selling up his house and his “Apartment” in the midlands to buy a comfy more efficient and smaller place for himself and the missus now that the nest is empty. He’ll do it to have his mortgage and debts cleared and his running costs to an absolute minimum. OK, I am going to go against the general grain of all the comments and say this left fielder idea of DMcW’s is great…for a lot of reasons 1) If we manage… Read more »
Philip – we have the worst health care in europe…..how can you convince a foreigner to trust their lives with you?
Given the care we’ve shown generally for our society to date, I expect the “Soylent Green” option for the aged to win out.
Scotland: Males 75; Females 80
Ireland: Males 75.6; Females 81.06
Spain: Males 78; Females 84
David, if you lived in Scotland, where would you retire to?
Mowlam Health Care is the biggest and best in Ireland and can be found in major regions .They should be a catalyst to a major opportunity to make David’s idea a realistic opportunity .
But where will we now find the foreigners to change the nappies of the incontinent elderly and do the jobs that the Irish turned their noses up at over the last 15 odd years???
They aren’t coming to Ireland anymore, so the plan looks like a fail to me…
What an absolute load of tripe ,prehaps it is down to your ever increasing workload between the two papers , your TV series , after dinner speaking and now your hosting of The Panel on RTE, does your editor at the indo not check your articles any more or is he annoyed with you for taking on The Thomas Crosbie gig in Cork?. My family have two big nursing homes and the simple fact is ALL their residents are from a 100 km radius of the homes. Sure we have an abundance of vacant housing estates , but do you… Read more »
FT~ NAMA, SPVs and other Irish magic
FT~ NAMA, SPVs and other Irish magic
See amount Anglo are down for under NAMA, truly shocking….
Not one of your better articles David, but fair play for the idea nonetheless. Because of all the Garlic brouhaha last wkend, I’m not sure if anybody noticed the extract in the sunday business post in which David recalls a meeting last year with a “half cut” Seanie Fitzpatrick. Reveals the dangerous sectarian undercurrent of “nativist” FFers….. I was too busy listening. Seanie was on a roll Most interestingly, h e spoke about how he had built the bank from practically nothing, and how Anglo had changed the way the country did business. For him, the success of Anglo and… Read more »
O.A.P’s and lateral thinking for the future, nice mix.
For me the mix end’s up in…
O.A.P’s retiring will in time become an idea that will dissolve away and in time people over 65 will continue to excel and live a full life and see old age in term’s of inner realities as opposed to entropy determined expiration.
Posters. I can’t tell you how nauseous i find it, as a citizen of Ireland, to have a OECD agent over here, giving a press conference flanked by BL and lecturing us all on what we all must do too ‘fix the economy’ pronto and get our neo serfdom selves productive again in the our everlasting servitude too paying more rent to the rent seekers. Someone please pass me the sick bucket. Also, in relation to the cut’s cut’s cut’s down the line for all, it seems to me to be the case the following,, Irrespective of the wholesale scam… Read more »
mcwillams and lenihan ala giftgrub – wonderful http://bit.ly/3AmVE3
(Apologies, David, but that Sh1t’s funny!)
Well that bates all, and your to blame for it David Mc Williams, and all your talk about bubbles and the avoidance there of. Just to explain my upset, after that article of yours appeared in fine print and you with the ear of the Minister of Finance. Twelve copies of the “buy and sell” is what I counted on the top of my Pub counter this wet day. Joe Reilly was looking for battery propelled Hearses, as He reckoned he was going to have to upgrade to fleet status. The two Malones were stuck in My ear (as the… Read more »
Suddenly “Logan’s Run” doesn’t seem that far fetched after all.
Time to get those crystals embedded in our hands. The only thing is do we let the same monkeys decide on the date the crystal turns black?
Time Warp Credit :
I think what David is meaning to say is that if we have borrowed so much money from Germany ………….and spent it ……then it should be easier to repay the full amount .’in kind’….by selling our Gruen Lands …and Irish Smiles …..and in a time fashion moment ‘ hey presto ‘…..we have lots of aging happy aging Germans in Ireland and….our youth in Germany with full employment to replace the dwingling active German workers .Where there is a ‘will ‘ there is a ‘way’. That is what politics is about.
I hope that this idea takes off, because at 23, I plan on leaving Ireland next year and I don’t intend to come back permanently for a long time. I’ve absolutely no confidence in the future of this country. We’ve been “independent” for the best part of a century and what have we achieved? We’ve still got a political system thats a relic of the civil war (and the incompetent parties and dynasties that came out of that). Our health service is a joke, our infrastructure is a joke, our education system is a joke. Even Northern Ireland has managed… Read more »
Folks, Can you believe that our “betters” at NCB Stockbrokers are ACTUALLY quoting Charlie Haughey, to support their argument against taxing the wealthy and in favour of taxing the lowest-paid people?
Here we go again, on the magic roundabout:
Stockbroker-man says “We are all living away beyond our means……..”
Just listened to David on Gerry Ryan. Interview / chat choc a bloc of interesting McWilliams ism’s. D focused in interview big time on binning the euro. Gerry gave the usual devil’s advocate on it and D kept the usual D sanguine stolid going forward P C plod pace. Gerry pushed a little for more and D kept his foot lightly on the accelerator. Gerry tried again, but D refused to put more horse power into his muscular apparatus. D if you are reading i reckon Gerry was trying to illuminate something to you, trying to transmit a message round… Read more »
Paddy and tim. Both of you are of on a tangent. Teacher’s pay is a ‘flying fish’.
The debating point is ‘over pay’ and it’s truth and not it’s spin.
Ireland’s concept of ‘reward’ on ‘labour’ is upside down. Let’s focus on that and get it onto the radar straightened out, for me anyways, i think it is central to the duping of the taxpayer into sectarianism and irrational tangents and wasted mental energies, exactly what the vested interests need to get away with their next stroke.
Folks, a different angle to the one being adopted by the NCB boyos, cronies and govt:
Marches in Limerick – today many marchers from all the local communities paraded blocking traffic and to morrow more tomorrow in UL Campus planned .The beginning has dawned and the engine rolls on.
Revenue Spot Checks – increases in numbers have occured this week on lawful registered businesses to make payments and declarations that are in arrears .Its real business and tactical on the Revenue’s part. CRO _ companies registered office – this outfit has no conscience for those exempt companies that are in arrears by a few days when they mean 28 days and not a calandar month .Many who have ceased trading but are holding their corporate indentity to take up an opportunity when/ if it arises have been shot down and denied acceptance of their returns because of the misunderstanding… Read more »
I’m looking forward to the Panel to see what grievious utterance DMcW could have made to offend the Delicate Blonde One. Or is that sexist too?
paddythepig, if you get the chance, please have a look at my attempt (above) at conciliation/clarification/explanation.
Best to “bury-the-hatchet” (and not between one-another’s shoulder-blades! The crony boyos have spent alot of effort and media-time trying to make us do that – we should refuse to oppose eachother at their behest; they are the ones we should be arguing against).
Happy Days are here again.
This looks like the stunting of the Godless Greedy Ones.
“The Roots of Violence: Wealth without work, Pleasure without conscience, Knowledge without character, Commerce without morality, Science without humanity, Worship without sacrifice, Politics without principles”
Cowen interview on Primetime dreadful dreadful.
Ireland is on the ‘brink’ and this is what we are getting tonight on RTE been told,
– don’t contemplate catastrophe
-we’re going to get the 400,000 back to work.
– growth will return this year to our economy.
-we’ve been building for the last 20 years a fairer economy.
– this year will see a return to a more prosperous society.
-doing nothing is not an option
Why are we all been spoken too like a gang of simpleton’s?
This is utterly bizarre.
Paddy have a look at 46 for my POV on teachers pay scale.
One could put forward the case that teacher’s ratio reward on their labour is the least rewarding all thing’s considered.
And it’s the diminishment of teaching as a vocation by virtue of this injustice that maintains a pervasive culture of gombeenism in power.