We're living longer on less
The mortality rate - which measures the number of deaths - dropped by 4% last year, marking significant upturn in the average rate of improvement of 2.4% over the 10 years to 2010. But can we afford to live longer?
The drop in the mortality rate means that 20,000 fewer people died in the UK in 2011, and this is the third year in a row that there have been fewer than 500,000 deaths.
"The last 20 years have seen unprecedented improvements in mortality rates, particularly for pensioners," said Gordon Sharp of the Actuaries Profession. "These figures are initial estimates for 2011, and are subject to revision once the ONS publish updated population estimates for the year. However, we are able to say with confidence that the mortality improvement for 2011 has been well above the average."
Sharp adds that mortality rates can vary significantly on a year to year basis so it is important not to read too much into one year's figures. "However, as policy makers continue to look for solutions to the challenges faced by an ageing population, it has never been more important to ensure that mortality figures and trends are properly analysed."
Aging populationIf this trend continues it will widen deficits in company pension schemes and lead to a further downward push in annuity rates.
Our aging population is also suffering from higher levels of inflation that official figures suggest, according to Age UK Enterprises, the commercial services arm of charity Age UK. Its latest findings last year found that over-55s have seen an 18% rise in living costs since 2008 - almost 5% more than the rest of population.
Pensioner povertyThis hike in the cost of living coupled with annuity rates hitting an all time low and the increase in life expectancy means those retiring today will be living for longer with far less money that pensioners five years ago.
Gordon Morris, Managing Director, Age UK Enterprises said: "We have to recognise that as life expectancy increases, and we see more people live into their 80s, 90s or to being over 100, action has to be taken to help them plan ahead to protect and maximise their income.
"Government and the financial services industry must improve the range of financial products available to those in later life, and the information and support available to ensure consumers only ever buy what best meets their needs. Unless this is addressed, there is a real danger that poverty will become the norm for those in the last decades of their lives."
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