The population of Denmark, and of many other countries, is aging. This is a threat to the financing of the welfare state due to higher expenses for pensions, health care, etc. However, Denmark has implemented a reform that in principle makes the welfare state robust to the aging of the population. An important part of this reform is indexation of the pension age.
The research done at CPop provide factual finding to deepen our understanding of challenges awaiting Danish society under the reform. For example, if the pension age rises too quickly, then many Danes, especially in disadvantaged groups, may die before reaching this age or shortly afterwards. On the other hand, if the pension age rises too slowly, the economic sustainability of the welfare state may be threatened. Using our interdisciplinary expertise, we examine both these clashing challenges, their consequences and likelihood.
Figure: Age distribution of additional population aged 65+ by 2070 under different mortality forecasts.
Challenges to Implementation of Indexation of the Pension Age in Denmark
ROCKWOOL Foundation, January 2020 to December 2022.