BASELINE STUDY STATE OF THE ART ACTIVE A.G.E. MANAGING CHANGE: THE IMPACT OF DEMOGRAPHIC AGEING FOR CITIES State of the art This paper supports the ACTIVE A.G.E. working group, presenting the “state of the art” on demographic changes and active ageing strategies at the European level. It traces a broad picture of the European debate, focusing on experience at the national and local levels. The first section illustrates the EU demographic trends and policy guidelines; the following sections will analyse the main issues emerging from these trends, the key drivers and the main policy domains (economy, care services and insecurity) and will present examples of projects, initiatives and strategies aimed at coping with these challenges. 1. EUROPEAN AGEING SOCIETY: TRENDS AND EUROPEAN PERSPECTIVE 1.1 Demographic trends in the EU 27 In the coming decades, the size and age-structure of Europe's population will undergo dramatic changes due to low fertility rates, continuous increase in life expectancy and the retirement of the baby-boom generation. Ageing populations will pose major economic, budgetary and social challenges. They are expected to have a significant impact on growth and lead to significant pressures to increase public spending, making if difficult for Member States to maintain sound and sustainable public finances in the long term. Worldwide, the proportion of mature people and the more aged is growing faster than any group. In the European Union Member States the share of over 64-year-oldswill be 22% in 2025 (up from 17% in 2008) (see Table 1) and the share of over 55 will be 31%, with peaks of 39% in Italy and 37% in Slovenia and Finland1. Demographic changes (such as increased longevity), and the phenomenon of a counter ageing society (that is a population that lives longer and feels younger )2 present both challenges and opportunities to promote active ageing. While longer life expectancy entails the need to postpone retirement in order to guarantee the sustainability of the welfare system and citizens well-being, counteraging allows for the promotion of longer working lives, and the integration of various sources of income in old age. To achieve the goal of a longer working life, however, it is necessary to overcome the main barrier which is represented by age-related discrimination. The new welfare should also provide for very effective health systems in order to improve the working and living conditions of mature people. Finally, older people must be recognised as active citizens and must have their interests promoted as such – in the labour market, in health and care and in community activities and in the society.3 1.2 European perspective: from challenge to opportunity The ageing population will affect society in a number of ways. Existing policies at both the EU and national levels need to be reviewed in order to assess their effectiveness and determine whether they need to be adjusted to take account of the changing EU demography. The European Union has opened the debate on how to tackle these issues, what role the EU should play and how demographic challenges need to be addressed. The first international debate on ageing society dates back to the 1980s, but the first initiatives only emerged in the 1990s. These included: the establishment of the European Commission’s Observatory on Ageing and Older People, the European Council of Essen4 and the Resolution on senior citizens in the 21st century – “a 1 COM(2005) 94 final 16/03/2005: Green Paper “Confronting demographic change: a new solidarity between the generations”. SEC(2007) 238 final 11/05/2007: Europe’s demographic future: facts and figures. 2 Cagiano de Azevedo R.(2004): “The European Welfare in a counter ageing society”, Kappa Edizioni, publication of articles presented at the international conference on active ageing, organized by the University La Sapienza of Rome. See also http://eng newwelfare.org/ . 3 See Activage, “Overcoming the barriers and Seizing the Opportunities for Active Ageing Policies in Europe”, Project funded by the European Community under the HPSE programme ‘Improving the Socio-Economic Knowledge Base’ (1998-2002). 4 “…The Essen European Council called on the Labour and Social Affairs and Economic and Financial Affairs Councils and the Commission to keep close track of employment trends, monitor the relevant policies of the Member States and report annually to the European Council on further progress on the employment market, starting in December 1995…” 1 new lease of life”5. In 1999, the United Nations in collaboration with the European Commission promoted the "International Year of Older Persons"6. In this communication the European Commission outlines a broad European policy agenda for active ageing. “The Commission points to the need for reforms of labour market practices (i.e. lifelong learning and training and ways of maximising labour market participation across all age cohorts), pension systems (i.e. flexible retirement options to curb early retirement) and health systems (i.e. effective and efficient health care provision for the elderly and the very old)” (Activage 2006). In the following years the debate waxed ever more intensive at European level, leading the European Commission7 to publish policy guidelines on the issue. In October 2006 Social Affairs Commissioner Vladimir Spidla presented his communication "The demographic challenge - a chance for Europe". The communication was a follow-up to the 2005 Green Paper on Demographic Change, which received input from a wide-range of stakeholders. The Commission's strategy rested on five policy pillars: 1. promoting demographic renewal combined with better access to accommodation, affordable and quality childcare and a better balance between working life and private and family lives; 2. promoting employment: creating more jobs and longer working lives, stimulating "active ageing" and improving public health; 3. improving the productivity of Europeans at work; 4. receiving and integrating migrants; 5. making sure that public finances remain healthy and guarantee adequate social security and equity between generations. "The source of the problem", the communication says, "is not higher life expectancy as such, rather it is the inability of current policies to adapt to the new demographic order and the reluctance of businesses and citizens to change their expectations and attitudes, particularly in the labour market". The "demographic challenge" has to be "mainstreamed" (integrated) into all other European and national public policies. The new employment guidelines and the Barcelona and Stockholm targets took the promotion of active ageing forward in an integrated approach promoting support for youth employment, labour market participation for women and reconciliation between work and family life at the same time. (See integrative guidelines no. 18 “Promote a new life cycle approach to work”). The European Parliament (EP) has contributed to moving the discussion forward at the EU level. The EP Inter-group on Ageing, originally set up in 1984, provides Members of the European Parliament (MEPs) with a forum for discussion and action. Over 35 MEPs - representing most of the Member States and all the political parties – support this Intergroup on Ageing. Among the issues that have been raised in the last couple of years are: age discrimination in employment and in access to goods, facilities and services; health; the right of residence for pensioners in the EU; pension provisions; and support for carers of dependent older people. Finally, a report presented by Bushill-Matthews, UK Conservative spokesperson on the EP employment and social affairs Committee and Vice-President of the Ageing Intergroup in the EP, called attention to the ways in which the ageing of Europe's population can be turned into an advantage. Education, training and positive attitudes to older people in the workplace can help, and not hinder, the European drive under the Lisbon Agenda to become more prosperous and globally competitive. The EP is of the opinion that Europe does not need more Directives but more exchange of best practice and more flexibility all round. The issue of the budgetary impact of an ageing population is, of course, of paramount importance. A report8 published by the European Commission Directorate General for Economic and Financial Affairs, “The impact of ageing on public expenditure: projections for the EU25 Member States on pensions, health care, long-term care, education and unemployment transfers (2004-2050)” assesses the potential economic impact, and the timing and scale of budgetary changes that could result from ageing populations. The fiscal impact of ageing will accelerate as of 2010. Overall, on the basis of current policies, age-related public expenditures are projected to increase on average by 4 percentage points of GDP by 2050 in EU25 and up to 10 % in several Member States. A preventative approach to the health status of the elderly could help alleviate the burden. The same applies to long-term care: policy measures that can reduce disability and favour home care rather than institutional care can have a significant impact on public spending. http://europa.eu/scadplus/leg/en/cha/c10223.htm 5 Text adopted by Euroepan Parlament, final edition 16/04/1999. http://www.europarl.europa.eu/pv2/pv2?PRG=CALDOC&TPV=DEF&FILE=990416&SDOCTA=2&TXTLST=1&PO S=1&LASTCHAP=6&Type Doc=FIRST&LANGUE=EN 6 COM(1999) 221 final 21/05/1999: Towards a Europe for all ages. 7 COM(2006) 571 final