Rich countries with the highest number of poor older people
Charlotte Irwin
03 August 2018
Old age poverty in affluent nations
There are 982 million people over the age of 60 in the world, and 180 million of them – 18% – live in poverty, according to Age International UK. And these include a growing number of older people in some of the world's richest countries. We look at the developed nations where many people are facing a poor old age, and why this is happening.
Ireland
In May 2018, Ireland's second biggest union, Fórsa, announced that 60% of private sector workers are facing poverty in old age due to a lack of pension income. Why? Because big companies are not fulfilling their pension responsibilities. The most recent figures show that, across the over-65s age group as a whole, the risk of poverty is 10.2%.
China
China is ageing fast. The percentage of over-60s is set to grow to 24% of the population by 2040, according to the World Health Organization, and research from Renmin University of China found that nearly 50 million old people lived below the poverty line of $1.90 (£1.45) a day. It's so expensive to live in China's cities that lots of old people have taken to living in cheap and confined "coffin homes", where many people share one room split into bunk beds.
Malta
Malta has a serious pension problem. Old people receive a very low pension income, which for many retirees constitutes a massive drop in their earnings. While the nation's poverty rate fell for children and youths between 2013 and 2016, for the over-65s it has increased from 21% to 26%.
USA
While poverty levels dropped overall by 0.8% in the US Census Bureau's 2016 poverty report, the over-65s fared less well. The group is the only one to experience rising poverty, with an increase from 16% in 2015 to 18.1%. This equates to 367,000 more Americans in poverty. Faster population growth, longer lifespans and high healthcare costs are thought to be to blame.
Greece
Greece's recession hit pensioners hard. In 2015, in a bid to fight its debt, the country dramatically increased the age at which people could receive a state pension age from 60 to 67, and the value of pensions was slashed, meaning that people had to work longer, or risk falling into financial difficulty. As of 2015, 2.7% of Greeks over the age of 65 were living below the extreme poverty line and having to survive off food handouts.
UK
According to a report by the Joseph Rowntree Foundation, one in six pensioners in the UK were living in poverty at the end of 2017, the equivalent of 1.9 million people. That's a rise of 16% from 2016. While the UK ranked fairly highly in the Global Age Watch Index in 2015, reaching number 10 in the world, changes to the government's welfare policy in that year's Budget are thought to be the culprit for the extra 300,000 pensioners living in poverty.
Thailand
In Thailand the poverty rate is higher for the over-60s, at 10.9%, than for the rest of the population, which has a poverty rate of 7.7%. And the problem is set to get worse. By 2060, the over-60s group will grow to 35% of the country's population. The Thai government does have benefits in place, but the Old Age Allowance is not means-tested and is one of the lowest benefits in the world in relation to average income, with poorer neighbouring countries such as Nepal offering higher value benefits.
Lithuania
In Lithuania the at risk of poverty rate was highest for the over-65 age group, which rose to 27.7% in 2016, despite slight increases in labour income and old age pensions.
New Zealand
Rather than the pension system impacting old age poverty, New Zealand's property market is a threat to the over-65s. There are fears that falling home ownership will undermine the value of pensions. The NZ Super – the name for superannuation in New Zealand – is calculated on the assumption of house ownership, so those who rent until retirement due to rising house prices may struggle to pay for their accommodation, as well as live.
South Africa
More than half of all South Africans were living in poverty in 2015, and 44% of those in the oldest age group were poor – an increase since 2011. In South Africa the youngest are typically the poorest, with poverty generally decreasing with age. However, the 65+ group was an exception to this, showing that once South Africans retire they risk falling back into poverty.
Japan
Japan has the world's fastest ageing population. Just over 27% of Japan's 127 million population is over the age of 65, and data shows that this age group accounts for over half of those living on welfare. There is also a silver crime wave. One in four old-age Japanese convicts are reoffending, largely due to poverty, with some seeing prison as a route to regular food and care. This led the government to assign nursing care staff to over half of its 70 prisons in 2018.
Spain
Spain's pensioners are protesting. Why are they so angry? Well, 32.6% of Spanish pensioners fall below the country's poverty line, which equates to 3.1 million people, and the recent 0.25% rise in pensions is not enough to help them rise above it due to the country's growing living costs. So thousands of pensioners took to the streets in 100 cities across the country in March 2018 to protest for higher pensions.
Chile
For the three million over 60s in Chile, it can be hard to survive on the pension provided by the government. The state solitary pension – for those with no other income – is only 104,000 pesos (US$165/£125) a month, which is well below Chile's own minimum wage of 150,000 pesos (US$395/£300).
Estonia
In 2016, the poverty rate for people over 65 in Estonia rose to 40.2% (up from 35.8% in 2014). This bucked the national trend, where the poverty rate decreased for other age groups. Retirees had to endure financial difficulties in the late 80s and 90s, as well as the introduction of Estonia's new currency, the kroon, in 1991, and now face low pensions.
Bulgaria
In 2016, 1.63 million Bulgarians – nearly 23% of the population – were living below the monthly poverty line. And while it wasn't the worst affected group, nearly half of all retired Bulgarians – 42.6% – were living in poverty.
Australia
While many Australians can afford to retire at 55, Australia is one of the worst performing countries for the financial security of its elderly people. A whopping 36% of pensioners live below the poverty line, according to an Organisation for Economic Co-operation and Development (OECD) report. Why? Australians in their old age face expensive living costs but are only armed with a low state pension since the government contributes just 3.5% of GDP to pensions, when the OECD average is 7.9%.
Mexico
Poverty is a key issue in Mexico, especially for its older population. In 2013, a report found that those in old age made up 50% of households living in extreme poverty. This is largely due to the fact that, for those in formal employment, social security benefits are not universal. Not forgetting that 50% of Mexicans are engaged in low-wage informal employment where pensions are scarce. In 2013 only 26.1% of those aged over 60 received pension benefit.
Latvia
Latvia has a high old age poverty rate, which was 27% in 2014 and therefore the second highest in the OECD ratings. While the country does have a system that provides universal coverage after retirement, the high level of poverty is probably a result of the low level of benefits received, and the fact that there are no survivor pensions for spouses.
South Korea
Almost half of South Korea's citizens aged over 65 now live in relative poverty, meaning they may have to keep working later into their lives. The average age of retirement is 72.1, 11 years later than the official government age. Who works longest? Here are the real retirement ages from around the world
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