Australia is getting older, and that’s about to become very expensive

The number of people aged 85 or older in Australia is predicted to triple over the next 40 years, while the over-65 population is set to double

It’s putting fast-growing spending pressure on health, aged care and national disability insurance, a new intergenerational report found

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An elderly man looks at Australian Stock Exchange Ltd. boards in Sydney. The number of elderly citizens in Australia is forecast to swell, while overall population growth slows. Photo: AP

Published: 3:03pm, 21 Aug 2023Updated: 3:37pm, 21 Aug 2023

Australia is facing a major demographic shift in the coming four decades, with the number of elderly citizens predicted to swell, while overall population growth slows.

Australia’s population is expected to grow to more than 40 million people by the early 2060s, according to data from the government’s latest intergenerational report released on Sunday.

Population growth is tipped to slow to 1.1 per cent over the next 40 years, down from 1.4 per cent over the past 40 years, according to the data. The full report, designed to guide lawmakers’ long-term policy, will be released on Thursday.

An elderly man reads a newspaper at Sydney’s Circular Quay. Australia’s aged-care economy could almost double to as much as 15 per cent of gross domestic product by the 2060s, according to a new report. Photo: Reuters

The country’s residents are also expected to live longer, with the number of people over the age of 85 predicted to triple over coming decades, while the over-65 population is set to double.

As a result, the country’s aged-care economy could almost double to as much as 15 per cent of gross domestic product by the 2060s.

Separate intergenerational report data released earlier on Sunday showed Australia’s ageing population and the cost of servicing debt was expected to blow out government spending by about A$140 billion (US$90 billion) over the next 40 years.

With Australia’s demographic outlook worsening, the report said three of the five fastest-growing spending pressures in the decades ahead were expected to be health, aged care and the National Disability Insurance Scheme.