Some of you may have missed a couple of stories that highlight the impact demographics – the aging population – will have on government budgets.
The federal parliamentary budget officer is warning that the federal government is facing a pretty serious “structural” imbalance that won’t be solved by simple budget cuts. As the Toronto Star reported:
Canada's falling birth rate coupled with baby boomers approaching retirement will "fundamentally" change the labour market for decades to come. In the next 10 years alone, the number of people who are retired compared to those still in the workforce will grow by 7 per cent – as much as it grew in the last four decades.
Retired workers pay less tax and draw more on programs like health care and seniors' benefits, driving up government costs.
Page said "permanent fiscal actions – either through increased taxes or reduced program spending, or some combination of both" will be needed to avoid ever-increasing government deficits.
The best line of all has a very familiar ring to it:
"The government's current fiscal structure is not sustainable over the long term," the report said.
Meanwhile, Quebec’s long standing pro-natalist policies won’t really deal with the very same problem in that province:
Bonne nouvelle : le Québec connaît depuis deux ans un petit baby-boom. Mauvaise nouvelle : il survient trop tard et sera donc loin d'être suffisant pour contrer l'effet de l'arrivée à la retraite de la génération du « vrai » baby-boom. Quand les bébés qui sont aujourd'hui dans leurs poussettes intégreront le marché du travail, ils ne seront jamais assez nombreux pour payer les pensions et les soins de santé de ceux qui s'appuieront alors sur une marchette !
Now these same issues will affect Newfoundland and Labrador, just as surely as the province never escaped the ravages of the current recession.
But how they will affect the province and what needs to be done are subjects for another post.
-srbp-