Demographic Change - A Key Policy Issue

The latest release from the Central Statistics Office (CSO) indicates that Ireland's population is now over 5 million as of April 2021, the highest since 1851.

While almost two thirds of the population are of working age, more than 1 in 7 are aged 65 or over, an increase of 112,500 on 2016. This is also the only age group to increase its population share. Social Justice Ireland has continuously highlighted the need for policies to adapt to the needs of an increasing and ageing population and for policymakers to tackle the challenge of demographic change.

The opening presentation of our 2019 Annual Social Policy Conference, The Challenge of Success, presented by James Hegarty of the CSO dealt comprehensively with this issue. Ireland will experience significant demographic changes in the next 30 years. By 2051, Ireland’s population will have increased by more than 1.5 million to around 6.5 million people. Up to 1.6 million of these people will be aged 65 or older, up from 630,000 at Census 2016. The number of those aged 80 or older is set to rise even more dramatically, increasing almost fourfold to around 550,000 by 2051. While the working age population will continue to increase, the number of older people will increase to such an extent that the dependency ratio will fall from around 5:1 to 2.5:1. Hegarty further outlined the likely trajectories that Ireland’s population will take between now and 2051. The profile of Ireland’s population is changing, and this requires a bespoke policy response from Government. We must begin planning for these changes now, as a significant increase in investment will be required to meet the challenges associated with an ageing population.

Among the most notable points from Hegarty’s paper:

• Ireland’s population is projected to increase from around 4.9 million in 2019 to around 6.5 million people in 2051.
• Up to 1.6 million of these will be aged 65 or older, up from 630,000 at Census 2016. The number of those aged 80 or older is set to almost quadruple.
• Ireland has experienced a decline in both the volume of births and in the fertility rate in recent years. The decline in the fertility rate has been especially dramatic, falling from 3.2 in 1980 to 1.8 in 2017. Despite this, we still have one of the highest fertility rates in Europe.
• Ireland has also experienced strong gains in life expectancy. Men living in Ireland can expect to live until 79.3 years old on average (an increase of 7.7 years since 1981) while women living in Ireland can expect to live until 83.3 years old on average (an increase of 9.2 years since 1981).
• Ireland has evolved from a country of net migration outflows to one that primarily experiences net migration inflows, with net inward migration recorded for 15 of the last 20 years.
• Ireland has become a much more multicultural society. In 1996, just over 53,000 (1.5 per cent) of residents were born outside of Ireland. In 2016, that had increased to just under 540,000 (11.3 per cent).

Most of these developments are extremely positive. However, Ireland needs a plan to deal with these trends and impending changes in the aftermath of a pandemic. Ireland’s levels of public investment have historically been quite low. The effects of inadequate investment are most obvious in light of the current crisis, in the areas of healthcare, housing, our dilapidated water infrastructure, the lack of an adequate rural broadband network, and inadequate public transport.

To support Member States to “mitigate the economic and social impacts” of the pandemic, the European Commission launched its Recovery and Resilience Facility, making €672.5 billion available for loans and grants to support investments by Member States[1]. To access this facility, Member States must develop Recovery and Resilience Plans that set out a package of reforms and public investment projects. Ireland is expected to receive €853 million in grants from the Facility over the next two years, with a further set of grants to be negotiated in 2023, taking into account the economic situation at that time. In June of this year, Government published a its National Recovery and Resilience Plan which sought to devote a minimum of 37 per cent of expenditure on climate change (with the remaining 63 per cent complying with the ‘do no harm’ principle) and 20 per cent to digital investments and reforms.

The National Recovery and Resilience Plan offers Government an opportunity to begin the implementation of a new social contract that could truly improve the quality of life for all, while charting a course for our long-term recovery.  Government must seize this opportunity to deliver on its own ambition, as stated in the Programme for Government, “to deliver a better quality of life for all, equality within society and a deeper sense of connection to the natural world around us, and each other”.

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[1] Recovery and Resilience Facility | European Commission (europa.eu)