Plan now for ageing population, NESDB director urges

Economy August 10, 2013 00:00

By The Nation

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The director of the National Economic and Social Development Board has urged state agencies to draw up a family-development plan that anticipates a highly dependent population after 2040, as academics expect Thailand to have a workforce insufficient to su

Speaking at a workshop on "Household Savings and Change in Population Structure" yesterday, Kosit Panpiemras said that by 2040, a quarter of Thailand’s population could be over 65 years old.

The country’s birth rate is dropping. That means there will be fewer working-age people in the future, affecting long-term economic expansion, said Kosit, who is also Bangkok Bank chairman.

By 2040, it is estimated that the average age of Thai males will be 75.3 years, while the female average is predicted at 81.9 years.

Thai state agencies should consider promoting sufficient savings to support life after retirement, he said, noting that changes in Japan’s population structure later caused economic problems.

Japanese Prime Minister Shinzo Abe has said that an economy that is boosted by fiscal and monetary policies does not sustain like one with manufacturing productivity, population structural planning and savings, he said.

"We have to change our mindset. We have to raise awareness of quality family planning, what the government and families should do. It’s not only investment or infrastructure development," he said.

Mattana Pananiramai, a member of the National Committee for the Elderly, said that as people got older, their saving capacity declined.

If the average income per worker and rates of consumption remain the same, a rise in savings capacity needs increases in labour productivity.

At present, Thai elders depend on their children, while government assistance is insufficient.

Based on a study, Thai people’s average lifetime income in 2009 was lower than their average lifetime consumption expenses. However, that consumption deficit was slight, given the higher number of working-age people.

But by 2040, the number of elderly people is projected to be more than the number of working-age people, so the consumption deficit is expected to widen significantly.

Nawaporn Wiriyanupong, a representative of the Ministry of Finance, said that based on these data, the government raised its budget for assisting the elderly from Bt10.63 billion in 2007 to Bt53.61 billion in 2012.

A rise in the number of elderly people could undermine fiscal stability, she said.