1. The Global Financial Crisis and the Health of Older People John Beard

2. Financial Crisis | July 2009 2 |2 | Our changing world Demographic and social upheavals –Ageing populations –Globalisation –Urbanisation –Technology Pre-existing socioeconomic crisis –Poverty, under-employment, growing inequality 2008 –???? Financial crisis

3. Financial Crisis | July 2009 3 |3 | Why is this important? Health of older people is inextricably linked with their economic security Economic strain and elder abuse Past evidence that economic downturns effect health –Increased mortality (Russian Federation, Thailand) –Depression and anxiety –Substance abuse –Neglect of health care, particularly prevention –Shift to public care

4. Financial Crisis | July 2009 4 |4 | Channels to Economic Security for Older People Continuing to work Reliance on public funded programs Reliance on inherited or accumulated assets Reliance on family

5. Financial Crisis | July 2009 5 |5 | Continuing to Work

6. Vignettes from 3 regions

7. Financial Crisis | July 2009 7 |7 | Latin America

8. Name: Ciprian Age: 77 Occupation: Farmer Location: Peru Photo: HelpAge International

9. Financial Crisis | July 2009 9 |9 | Latin America 2003-2007 years of unprecedented growth –↓poverty –↑social security and social assistance –↑ policies addressing needs of older people BUT STILL only 40% of those over 70 yrs receive retirement or pension income, many have some difficulty accessing health services

10. Financial Crisis | July 2009 10 | Latin America 2008, leading in to financial crisis: –↑food and fuel prices –↓employment (high proportion of older people dependent on work income) –↑ informal employment Remittances (eg in 2004 in Nicaragua older people received more in remittances than social security benefits).

11. Financial Crisis | July 2009 11 | Asia and Sub Saharan Africa

12. (c)Jon Bugge /HelpAge International Chheut, 68, Battambang Province, Cambodia

13. Financial Crisis | July 2009 13 | Asia Relatively high proportion dependent on ongoing work Public sector support varies widely Urbanisation

14. Financial Crisis | July 2009 14 | Asia Assets: Crisis hurting assets in all countries, but older people in China have fewer assets with almost half the gap being filled by family. Family: Many older people live with their children and are economically interdependent BUT family support is falling across Asia. E.g. in Japan –1984: older people dependent on family support as much as public support –2004: 80yrs receive some support, but now primarily dependent on public transfer

15. Source: Kakwani 2005

16. Financial Crisis | July 2009 16 | USA

17. Financial Crisis | July 2009 17 | New perspectives on "retirement"

18. Financial Crisis | July 2009 18 | USA – approaching retirement BUT early retirements have ↑25% over 2008 (cf 15% expected) Early retirement associated with PERMANENTLY reduced benefits (↓ 25% if retire at 62 instead of 66) Over 50s account for 28% of all foreclosures

19. Financial Crisis | July 2009 19 | USA – Employment in Older Age Groups Less likely, but less less likely to be fired If lose job, unemployed for longer Steeper drop in income with new employment 55-65 yrs is generally peak earning period when people maximise assets to fund retirement. Less time to recover

20. Financial Crisis | July 2009 20 | USA – Reduced Social Programs

21. Financial Crisis | July 2009 21 | US Social Security Trust Fund SOURCE: Congressional Budget Office. Tobey

22. Financial Crisis | July 2009 22 | US Social Security Trust Fund "It suggests we better get working on Social Security and stop burying our heads in the sand," said Sen. Judd Gregg, the senior Republican on the Senate Budget Committee.

23. Financial Crisis | July 2009 23 | What does this all add up to? Governments will find it difficult to maintain provision of some social services Older people face less economic security from all sources Underlying social and demographic changes are placing heavier emphasis on government support The consequences of the crisis on older people are likely to be VERY long lasting People transitioning to older age particularly at risk

24. Financial Crisis | July 2009 24 | What can be done?

25. Financial Crisis | July 2009 25 | Past experience In the early 1980's the world faced a crisis from soaring oil prices and global debt. The international response was to shift budgets away from investments in the social sectors, most notably health and education. Many countries are still suffering the legacy of these decisions.

26. Financial Crisis | July 2009 26 | But it can be different In the Asian economic crisis of the 1990's South Korea extended unemployment insurance and has further expanded this programme since then. In Thailand in 1997-98 the outflow of physicians from government services to the private sector was reversed and this has since been sustained. Price increases made it possible to introduce medicines based on generic substitution.

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28. Financial Crisis | July 2009 28 | What can be done Stimulate demand, build confidence Immediate social protection is required to safeguard incomes for older adults, stabilize prices, and help people maintain health insurance. Particularly for the older old. Older people should not be excluded from temporary employment schemes. It is crucial to keep people who are transitioning to retirement in the workforce for as long as possible. Continue support for low income countries (Inter American Development Bank) Investment in the social sector and in human capital, rather than tightening health and social budgets - tackle underlying structural problems in the health sector, sustain support for prevention.

29. Financial Crisis | July 2009 29 | Restructure for the upturn Now is the time to invent the future, to maximise the potential for older people to benefit from the return of growth. But we need to adapt to new circumstances: –Older populations (market, workforce, care) –Low carbon economy –Globalisation During the downturn focus on retraining older people while we provide the necessary support Then focus on facilitating re-entry into the new economy

30. Financial Crisis | July 2009 30 | Restructure for the upturn Explore new ways that older adults can contribute more flexibly. –1000 hour work year –Intergenerational job sharing –Work-pension mix –Delaying formal retirement ages, shifting incentives toward later retirement

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32. Financial Crisis | July 2009 32 | The future is not determined by the past. Nor is it a gift: it is an achievement. Every generation helps make its own future. This is the essential challenge of the present. Creating a new future