The latest Quarterly Economic Report to the Council of Ministers highlights the continued growth in the number of pensioners in the Isle of Man.
 
The report, for the period 1 July to 30 September 2014, shows a 2,400 increase in the number of people in receipt of pension income over the past three years.
 
The same period has witnessed a reduction of 1,100 in the Island’s working population, coupled with a fall in unemployment of more than 200. The statistics also point to more people having more than one job.
 
The report states: ‘Enough jobs are being created to reduce the unemployment count. However, the trend towards more retired persons and fewer in work has implications for the dependency ratio [the number of people not of working age, compared with the economically active population], for National Insurance receipts and for the range of job opportunities for those coming into the workplace.’
 
Chief Minister Allan Bell MHK said the underlying trends emphasise the need for Government to address a range of big ticket issues, such as benefits and healthcare costs, to ensure the Isle of Man’s future sustainability.
 
He commented: ‘The Island’s economy is still expanding by more than 3% per year, taking us to our 30th consecutive year of growth. However, while unemployment is falling, we are seeing a reduction in the overall number of people in work and an increase in those holding multiple jobs. As the dependency ratio increases, this impacts on our state pensions and benefits.
 
‘Ten years ago our spending on benefits and pensions was ?147.5m. This year we expect to spend ?268.4m. Similarly, our spending on health and social care will be ?234m this year – a quarter of our total gross budget. We cannot sustain this and that is why Government is working to develop a system that is fair and supports those most in need. This is a challenge being faced by many other nations and was high on the agenda during discussions with political leaders at the recent British-Irish Council Summit.’
 
The number of older people in the Isle of Man is projected to rise from 16,000 in 2014 to 26,000 by 2035. A report by performance improvement consultants Ci65 commissioned by Treasury predicts that if changes are not made the Manx National Insurance Fund, from which the state pension is paid, will be exhausted by 2047 – seven years earlier than previously forecast.
 
The Chief Minister said: ‘The Ci65 report recommends a bold transformation of the social security system to make it meet the Island’s needs and protect the future of state pensions and benefits. Doing nothing is not an option.
 
‘We don’t want to scare people, but we must continue to raise awareness of the scale of these challenges and engage the public in discussions about our future direction.’