Treasurer Joe Hockey and his band of Treasury officials have emerged from their crystal ball gazing to predict the shape of Australia circa 2055. The results, like much futurology, are a mix of data analysis, inspired guesswork and optimism.
Or if you prefer, the bleeding obvious (we will live much longer), the concerning (fewer people of traditional working age), and the how-could-you-possibly-know? (economic predictions tend to assume a consistency that changes in governments or global circumstances cannot guarantee).
One critic of the economic projections said the only sure thing about the economy in 40 years’ time is that there will be an economy.
The 2015 Intergenerational Report (IGR) does, however, contain a caveat – “Long-term economic projections present one possible outcome based on a set of well-informed projections and assumptions about future changes in Australia’s population, workforce participation and productivity.”
Prior to the release of the 145-page (including appendices and references) document on 5 March the Treasurer warned it would “knock us off our chairs”, yet real surprises were conspicuously absent.
After the launch Mr Hockey was speaking in measured tones about how it signposted a “social compact between generations” on a road to “immense future potential.” That assumes, to quote the final words of the report’s summary – and to hint of federal Budget strategy - “we plan for tomorrow, today”.
The IGR, the fourth to date, has been described as a political document and criticised mainly on the basis of its time-frame: who can predict how society will look four decades into the future? Only a few years ago we’d never heard of the iPhone, or 3-D printers or… governments that only endure for a single term.
Interestingly, considering the government’s narrative about the health system being in need of major change, the report notes that, “Australian families enjoy access to a well-functioning health system.”
It continues in an upbeat manner about “good schools, a strong social safety net and options for recreation and leisure that our grandparents could only dream about.”
Of course our grandparents didn’t have IGRs to tell them what today might hold.
One thing seems certain – there will be many more grandparents in the future, with life expectancy at birth projected to be 95.1 years for men and 96.6 years for women by the end of the report’s timeframe.
There are projected to be around 40,000 people aged over 100, well over three hundred times the 122 Australian centenarians in 1974-75. This should keep Buckingham Palace busy with the congratulatory letters.
The IGR predicts that “improvements in health” will mean people are more likely to remain active for longer, saying this ‘active ageing’ presents “great opportunities for older Australians to keep participating in the workforce and community for longer, and to look forward to more active and engaged retirement years.”
However, there is little analysis about managing the burden of chronic disease that will affect so many people in the older (and the poorer) age groups.
Instead, there is a generalisation that Australians will live longer and do so in better health, and that more of us will continue to lead an active lifestyle and participate in the workforce after reaching traditional retirement age.
Regarding health funding, the report focuses on the federal government’s commitment, which has been falling, rather than that of the states, which in consequence has been rising, much to the ire of the Premiers.
Moreover, this trend will continue, with the IGR projecting health will account for a much lower proportion of GDP than previously reported
The greater number of the ageing is likely to increase their participation rates in the workforce, it says, with those aged 65+ projected to increase from 12.9 per cent in 2014-15 to 17.3 per cent in 2054-55 – “If they choose to,” The Treasurer added hastily in his media conference.
“This represents a significant opportunity for Australia to benefit more from the wisdom and experience of people aged over 65,” the report said.
Female employment is projected to continue to increase: “In 1975, only 46 per cent of women aged 15 to 64 had a job. Today around 66 per cent of women aged 15 to 64 are employed. By 2054-55, female employment is projected to increase to around 70 per cent,” the IGR said.
However, the rate lags behind certain other countries, including NZ and Canada. “Policies that help to continue to boost female participation will help Australia achieve an even higher level of future prosperity.”
