Speaker 1: Bloomberg Audio Studios, Podcasts, Radio News.
Speaker 2: Hello, it's Maren Sums. That were Pierre. We have got
Speaker 2: a great episode for you this week. We're talking about aging,
Speaker 2: one of the opportunities and challenges of longer lives in
Speaker 2: the twenty first century. Economists and author Andrew Scott is
Speaker 2: with us to talk about his book The Longevity Imperative,
Speaker 2: building a better society for healthier, longer lives. So we
Speaker 2: sort of stick around for that bit, but first, as always,
Speaker 2: senior reporter and author of the Money Distolveed newsletter, John
Speaker 2: Steppeck is with me.
Speaker 3: John, ma'am.
Speaker 2: You know we're going to talk about other aging stuff now,
Speaker 2: about older people and how things are going to work
Speaker 2: with him financially, because this week has been all about
Speaker 2: the state pension and Richie Stunac's unbelievably ridiculous and stupid
Speaker 2: nonsense about putting in place what he calls a triple
Speaker 2: plus lock on the Who don't know all that, I
Speaker 2: suspect everybody does. The UK pension, which is not not tiny,
Speaker 2: comes with what we call a triple lock, whereby it
Speaker 2: goes up every year by the higher of a completely
Speaker 2: random number two and a half percent average wages or
Speaker 2: inflation right, and richards Nik is suggesting adding to that
Speaker 2: what he calls a plus, which is that the personal allowance,
Speaker 2: your income tax personal allowance will never be lower than
Speaker 2: the state pension, so you will therefore never be taxed
Speaker 2: on your state pension, unless, of course, you are already
Speaker 2: taxed on your state pension because you don't have an
Speaker 2: income tax allowance because you earn over one hundred thousand
Speaker 2: pounds or one hundred and twenty five, where it's completely
Speaker 2: tapered away that allowance. See, I'm already irritated. I've worked
Speaker 2: myself up into a frenzy of fury, and I haven't
Speaker 2: even let you speak yet, John, Why is this a
Speaker 2: completely absurd idea? Not politically, by the way, because it's
Speaker 2: an excellent political idea giving money away to pension It
Speaker 2: gets you votes lovely. Why they bother at this point,
Speaker 2: I don't know. But why is it a an appalling
Speaker 2: financial idea?
Speaker 3: I mean to be clear that this is a personal
Speaker 3: allow One of the reasons a bad idea is because
Speaker 3: this personal allowance is only for pensioners. So like my
Speaker 3: personal allowance won't be going up and the other will yours.
Speaker 3: It's only for the people getting the state pension. So
Speaker 3: for a start, you mightage to get rid of one
Speaker 3: of the few pieces of tax simplification that we've actually
Speaker 3: seen over the last fourteen or so years, which was
Speaker 3: the kind of harmonization of the personal allowance. So that's
Speaker 3: one reason is bad. The other reason is bad is
Speaker 3: because we we already can't afford this, and you're adding.
Speaker 3: And not only is it you know, it's more expense
Speaker 3: for related to the state pension, but it's also because
Speaker 3: of all of these lockings that we're doing, a it's
Speaker 3: always going to rise in real terms, so it's always
Speaker 3: going to be bigger than our basically can't inflate this
Speaker 3: debt away. And on top of that, it's also uncertain,
Speaker 3: so you can have a rough idea of what liability
Speaker 3: you're committing to, but if inflation spikes, as it has
Speaker 3: done obviously in the last kind of couple of years,
Speaker 3: then that liability rockets. So this is just it is.
Speaker 3: I mean, it's so cynical in terms of being a
Speaker 3: purely political move, and a lot of it seems to
Speaker 3: be in response actually to well the last budget. So
Speaker 3: Jeremy Hunt, National insurance contributions for employees, and obviously National
Speaker 3: Insurance is a tax that isn't paid by pensioners because
Speaker 3: it's a tax on people who work, or so people
Speaker 3: of working age. And the reaction from me, I cannot
Speaker 3: imagine that this is the majority of pensioners. But the
Speaker 3: reaction from a kind of mouthy pro pensioner lobby group
Speaker 3: was to be like, oh my god, you're terrible, this
Speaker 3: is awful. How dare you know? You're given a tax
Speaker 3: cut to other people. But this was not a.
Speaker 2: Tax rise for pension. It was an everything stays the
Speaker 2: same for pensions, but working people while they're really paying
Speaker 2: a lot of times. Now, let's try and ease it
Speaker 2: up a little. And along the way, I mean, you
Speaker 2: and I had this conversation, we kind of hope that
Speaker 2: what it was was a glide path to getting rid
Speaker 2: of NI altogether, because it's both dishonest and ridiculous and
Speaker 2: complicated and having effectively having two income taxes inside a
Speaker 2: tax system where we do not hypothecate which good thing,
Speaker 2: by the way, is absurd, absurd, So getting rid of
Speaker 2: NI good thing. Pension is complaining about getting rid of
Speaker 2: NI bad thing.
Speaker 3: Fah yeah.
Speaker 2: Yeah.
Speaker 3: And also I think we're I feigned, I'm not completely
Speaker 3: politically naive, but we are. We've gone well beyond the
Speaker 3: point for many years now where politicians just seemply react
Speaker 3: on a headline to headline basis. I mean, the other
Speaker 3: reason that sus souikes pulling this out of the heart
Speaker 3: is because she was I mean, I don't even know
Speaker 3: why he was on Loose Women. Frankly, for anyone who
Speaker 3: doesn't know, this is some tea.
Speaker 2: John John's absolutely desperate to get on it. So question time,
Speaker 2: he must be on loose Women, right John, That's what
Speaker 2: That's what the audience is.
Speaker 3: I mean, that's that's true. That's a good point. Maybe
Speaker 3: that is why they go on. But a Janet Street Porters,
Speaker 3: who I'm sure everyone remembers a kind of like music journalist,
Speaker 3: went back in the day. So I said to him,
Speaker 3: you know, why do you hate pensioners? And you know,
Speaker 3: I mean my immediate thought, and the thought of anyone
Speaker 3: who actually knows anything about the financial system, would have been,
Speaker 3: what on earth are you talking about the one group
Speaker 3: of people who are in no position to complain after
Speaker 3: fourteen years of Tory misrule, if you want to put
Speaker 3: it that way, pensioners. They've they've done so much better
Speaker 3: than and aggregate than any other section of the population.
Speaker 3: So I can sort of see why he must have
Speaker 3: been panicking because he was thinking, oh my god, it's like,
Speaker 3: you know, I used to forego one budget without throwing
Speaker 3: them a freebie, and suddenly you know, I'm the that
Speaker 3: lords them. So you know, but I think this kind
Speaker 3: of like kne Jet policy. Is it posted tourning around
Speaker 3: and presenting some facts to people, you know, instage Just
Speaker 3: Piney can see, well, okay, we're going to make sure
Speaker 3: you never have to pay tax on this and that.
Speaker 3: What's the next thing that's gonna what?
Speaker 2: Just don't ever now, Just be just to be fair,
Speaker 2: John and I aren't that far off being pensioned as ourselves.
Speaker 2: You know, this will come one day and then you'll
Speaker 2: hear a full on turnaround from us, full on turnaround.
Speaker 2: We'll be wanting those tax breaks up. So we want
Speaker 2: that state pension to be linked to everything under the sun,
Speaker 2: et cetera, et cetera. None of those things are going
Speaker 2: to happen. And it's very likely that once we get
Speaker 2: a new labor government and that they have that wonderful
Speaker 2: six months when they can actually do stuff if they
Speaker 2: are brave enough. If they are brave enough, it may
Speaker 2: be that they do look at the state pension, possibly
Speaker 2: in the pension system as a whole, and say, hang
Speaker 2: on a dick, we really need to make some changes here.
Speaker 2: This is so expensive. You know, the state pension is
Speaker 2: already of a five percent of GDP eleven point three
Speaker 2: percent of state spending. I've got that number in frontally
Speaker 2: because both John and I have written about it this week,
Speaker 2: because that's how cross it makes it. So you can
Speaker 2: find a column from that on me and money, just
Speaker 2: not from John. But change is coming, right, I mean,
Speaker 2: either we see the triple lock dumped somehow, we see
Speaker 2: the triple lock abandoned, one element taken out right, or
Speaker 2: we see big changes to the way tax relief on
Speaker 2: pensions works. Or I was thinking about this the other day,
Speaker 2: and I was thinking, and I mentioned this in the column.
Speaker 2: I'm waiting for some pushback on it. Entirely possible. What
Speaker 2: would happen if the state pension was abolished altogether? And
Speaker 2: if I know, I know, I know. But let's say
Speaker 2: that auto enrollment picks up, so there's a higher levels
Speaker 2: of obligatory personal and state employer contributions. Right, maybe it
Speaker 2: stops being maybe it stops in voluntary. Maybe everybody has
Speaker 2: to enroll, right, Maybe that happens. And at the same time,
Speaker 2: we do have a very effective pension credit system where
Speaker 2: if you if you come into your late sixties with
Speaker 2: no income of any kind whatsoever, you get put in
Speaker 2: the pension credit system. You get two hundred and one
Speaker 2: pounds a week, you get housing benefit, and you get
Speaker 2: all the other smaller payments that you get it in
Speaker 2: your later years that one way or another would hold
Speaker 2: body and sould together. So if you've got both those
Speaker 2: systems running concurrently, do you need a state pension system? Now,
Speaker 2: don't get me wrong, I want a state pension system,
Speaker 2: But do you need it?
Speaker 3: I mean, I think this is a really good question.
Speaker 3: It's a really tricky one. But I think that first
Speaker 3: if you and I can talk about this in terms
Speaker 3: that politicians would never dare but effectively, what your first
Speaker 3: acknowledging is that a state the state pensions are benefit
Speaker 3: rather than something that's sitting in a port with your
Speaker 3: name on it. And then you're saying, well, actually, look,
Speaker 3: if it's a benefit, then maybe that means that not
Speaker 3: everyone needs to get it. And I thought the other
Speaker 3: interesting thing that you pointed out in your piece, and
Speaker 3: this actually maybe where sort of frozen tax thresholds come
Speaker 3: into play effectively. If you if you say you've got
Speaker 3: a pension that's somehow you know, paigey, you know, like
Speaker 3: in the region one hundred and thirty pounds a year,
Speaker 3: your entire state pension is getting clawed back anyway. So
Speaker 3: there is a way, there is a point at which
Speaker 3: if you kind of you, if you actually had the
Speaker 3: goal to freeze the income tax threshold for the next
Speaker 3: thirty years, say, and suddenly the number of people who
Speaker 3: are you know, paying who are getting the personal allowance
Speaker 3: claw back climbs to the same numbers, say as are
Speaker 3: paying forty percent income tax today. It suddenly becomes a
Speaker 3: kind of mainstream thing rather than a very rich thing.
Speaker 3: Then actually you could essentially remove this the pension by
Speaker 3: the bike door.
Speaker 2: Not a recommendation, by the way, not a recommendation, right, John.
Speaker 3: No, No, no, And I think even that would be
Speaker 3: hard to get a.
Speaker 2: We with I suspect that'll be that'll be some means
Speaker 2: with some kind of means testing coming under a labor
Speaker 2: government would be my guess. I'm it's hard to imagine
Speaker 2: how they'll be able to get away with the whole
Speaker 2: idea of continuing to pay eleven to twelve pounds to
Speaker 2: the wealthy, the riches, the one percent, the five percent,
Speaker 2: whatever it is. So watch out for some means testing
Speaker 2: either way. Keevan Aisle State Pensions and do read John's
Speaker 2: column on it. Do read my column on it. Welcome
Speaker 2: to Meren Talks Money, the podcast in which people who
Speaker 2: know the markets explain the markets. I'm Meren Sum's web.
Speaker 2: Here's my conversation with author Andrew J. Scott as we
Speaker 2: talk about his book The Longevity Imperative, building a better
Speaker 2: society for healthier, longer lives and, by the way, hopefully
Speaker 2: also richer lives. Andrew, Hello, thank you so much for
Speaker 2: joining us today.
Speaker 4: Very kind, pleasure to be here, Maren, always good to talk.
Speaker 2: Excellent. Now you and I are both very, very very young,
Speaker 2: so a lot of the things we're going to talk
Speaker 2: about today we don't have to worry about quite yet.
Speaker 2: So really, where we're thinking about our listeners who may
Speaker 2: be older than us.
Speaker 4: Right, Yeah, Aging is a process, and everyone's getting older.
Speaker 2: Aging is a process, not an event. That's one of
Speaker 2: your catchphrases, right.
Speaker 4: Yeah, exactly. So, yeah, I'm interesting this topic of longevity,
Speaker 4: which I think is really about all of life rather
Speaker 4: than just the end of life.
Speaker 2: Okay, all right, then we're talking about us too. I
Speaker 2: mean that the basis of the book is that we
Speaker 2: are all living longer. A lot of us are living longer,
Speaker 2: and we're living longer in a healthier way. So the
Speaker 2: stat that really jumps out is this one about how
Speaker 2: in nineteen ninety there are only ninety five thousand people
Speaker 2: who are over one hundred years old. Now it's around
Speaker 2: half a million and rising fast, and that's a huge change.
Speaker 2: And then, of course we have the main driver behind
Speaker 2: increasing lifespans, which is not so much that people are
Speaker 2: living longer once they've passed sixty, is that they're not
Speaker 2: dying younger. So can we talk about that a bit first,
Speaker 2: in that I absolutely understand that these numbers, the average
Speaker 2: numbers a rising because people don't die in their first
Speaker 2: year or their second year or under five anymore. We've
Speaker 2: pretty much nailed that. But is it really true that
Speaker 2: if you are just separate out that people live longer.
Speaker 4: Yes, it is. I mean, you're certainly right that you know,
Speaker 4: the fantastic improvements, particularly the rich countries in reducing from mortality,
Speaker 4: have had a huge impact, but it isn't just life
Speaker 4: expectancy at birth. Basically, however old you are, we've seen
Speaker 4: an increase in the number of years you can expect
Speaker 4: to live ahead of you. It's certainly true that the
Speaker 4: biggest increases have come at birth, but what we're finding
Speaker 4: now is that, for instance, in Japan, Japanese women had
Speaker 4: the highest life expectancy. A newborn girl in Japan has
Speaker 4: I think in ninety seven percent chance are making it
Speaker 4: to sixty. So what we're seeing now is nearly all
Speaker 4: the life expectency gains are happening from the age of
Speaker 4: seventy and above, so life expensive growth is slowing down.
Speaker 4: But now it's almost entirely about your chances are going
Speaker 4: beyond seventy into eighty and ninety. So that's the shift
Speaker 4: that's happened. We've seen improvements at all ages, but now
Speaker 4: the increases are coming more and more at the older ages.
Speaker 2: And what about the numbers that we've seen over the
Speaker 2: last couple of years that suggested in some countries life
Speaker 2: expectancy is actually falling, And I'm interested. You mentioned in
Speaker 2: Japan right, where it's well into the late eighties. Now
Speaker 2: the average woman can expect to live in Japan, right,
Speaker 2: But there's been a big change in diet and a
Speaker 2: big change in environment in Japan over the last forty
Speaker 2: or so years. So how confident are we that someone
Speaker 2: born into modern Japan might have the same life chances
Speaker 2: in terms of health as someone born into Japan fifty sixty,
Speaker 2: seventy years ago.
Speaker 3: What as an.
Speaker 4: ECONOMISTYE is always told that the rules of forecasting is
Speaker 4: the first one, never give a number, The second is
Speaker 4: if you give a number, never give a date fat
Speaker 4: and the thirties never give numbers or dates. So forecasting
Speaker 4: is very difficult, particularly into the future. But now I
Speaker 4: think we can be recently confident. I mean, I think
Speaker 4: what's stunning is over the last one hundred and fifty years,
Speaker 4: the best practice life expectancy, the country of the highest
Speaker 4: life expectancy has increased two or three years every decay.
Speaker 4: And I think that's likely to slow down, possibly to
Speaker 4: one or two, but I think it's still very likely.
Speaker 4: And one of the problems we've got is life expectancy. Intuitively,
Speaker 4: it seems a simple concept, but it's actually quite complicated.
Speaker 4: And when I first started in this area, statisticians that
Speaker 4: I don't like life expectancy as a concept, and I thought,
Speaker 4: why not. It's a great thing, but I can see
Speaker 4: the challenges in particular the numbers you're referring to about declines.
Speaker 4: First of all, they're very much during COVID for most countries,
Speaker 4: which is understandable. Secondly, they tend to be focused on
Speaker 4: the US. We saw a small foreign in life expectancy
Speaker 4: outside of COVID, but that's totally due to this phenomena
Speaker 4: of deaths of despair. It's midlife mortality. Your chance of
Speaker 4: living longer at sixty five continues to increase. And the
Speaker 4: big confusion in all of this is the blind numbers
Speaker 4: that you tend to read, which the government promotes. It's
Speaker 4: not really life expectancy. It's gonna sound a bit morbid.
Speaker 4: It's the average age of death. It basically assumes that
Speaker 4: you live your entire life in that particular year. So
Speaker 4: if you're a newborn, you use the survival rate of
Speaker 4: a sixty year old today rather than the survival rate
Speaker 4: you're likely to face in sixty years time. So those
Speaker 4: tend to be very much an underestimate of life expectancy.
Speaker 4: That's why when you have a global pandemic, you see
Speaker 4: a fall in life expectancy, But as the pandemic goes away,
Speaker 4: you see a return to growth. So I don't want
Speaker 4: to trivialize and say it's going to be automatic, but
Speaker 4: the vast majority of countries will continue to see gains
Speaker 4: in life expectancy. I suppect those at the top will
Speaker 4: see a slow down because, as I said earlier, sort
Speaker 4: of the scope to improve life expensive if you'm going
Speaker 4: from nought to sixty is pretty minimal now. So all
Speaker 4: the gains are going to come later on. And yes,
Speaker 4: we have to worry about antibiotics resistance, Yes we have
Speaker 4: to worry about a whole host of things, but it's
Speaker 4: a pretty entrenched trend that I think, if you look
Speaker 4: at some of the innovations that are coming along in
Speaker 4: terms of medicine, is likely to continue.
Speaker 2: Okes But there's this one to challenge I would make
Speaker 2: to that, which is that this is the first generation
Speaker 2: in which you could look at developed countries and say
Speaker 2: that going on half of the population is obese.
Speaker 4: And no, I agree, But I think if you look
Speaker 4: at inequality. That's a really big challenge. One of the
Speaker 4: status of us in the book is eighty percent of
Speaker 4: how we age is down to behavior in the environment,
Speaker 4: which means that aging is incredibly malleable. So of course
Speaker 4: what happens the average may be different to what happens
Speaker 4: in terms of those at the top end. But I
Speaker 4: still think we'll see more and more people living into
Speaker 4: older and older ages, and some of that may not
Speaker 4: be a good thing, because we do have a health
Speaker 4: system that tends to keep people alive rather than keep
Speaker 4: people healthy.
Speaker 2: Okay, well, I'm going to ask you the question now
Speaker 2: that I should ask you, because otherwise people all write
Speaker 2: in and say why didn't you ask him? And you say,
Speaker 2: aging is very malleable. What are the things that we
Speaker 2: should all do outside taking powers of drugs to keep
Speaker 2: ourselves as younger as possible. I know the answer, but
Speaker 2: you know I'm asking you anyway. I'm hoping. I'm hoping
Speaker 2: there'll be something new like sit on the sofa and
Speaker 2: watch as much Telly as possible.
Speaker 4: Yeah, no, that's exactly well, I'm sure those things are
Speaker 4: very good. This is where it gets very complicated, isn't it?
Speaker 4: Because everyone sort of wants the big haha moment. But yeah,
Speaker 4: it's all sort of pretty obvious stuff at the moment.
Speaker 4: I mean, there's a lot of interesting stuff coming along
Speaker 4: in terms of drugs and biology, but it's all the
Speaker 4: stuff that everyone tells you and that you know, which is,
Speaker 4: don't eat too much, exercise a lot, keep moving, don't
Speaker 4: drink too much alcohols and toxin smoking is bad for you.
Speaker 4: Sleep is particularly important, A sense of purpose, a sense
Speaker 4: of engagement, friendships, and all the stuff that we know
Speaker 4: makes a good life. I think all this change is
Speaker 4: a couple of things. The first is this is, as
Speaker 4: Peter Astio says in his book Outlive, there's some sort
Speaker 4: of breakthroughs in terms of what type of exercise to
Speaker 4: do and how to do this sort of the diet,
Speaker 4: the fasting stuff is very sort of trendy at the moment,
Speaker 4: the high intensity draining, et cetera. So there's some sort
Speaker 4: of innovations. But my own attitude and that is that
Speaker 4: that's about optimizing as opposed to just mainly doing the
Speaker 4: right thing eighty percent of the time. And then the
Speaker 4: other thing that's really changed is your incentive to do it,
Speaker 4: because at the heart of my book is a statistic
Speaker 4: that just says, you know, you are now the majority
Speaker 4: of the young are now likely to become the older. Again,
Speaker 4: going back to the ons, they estimate the fifty center
Speaker 4: children born today will live into their nineties. And you
Speaker 4: know you are now likely to get old. But we
Speaker 4: fear getting old. So what do you do now to
Speaker 4: age well? Because you can start to age better at eighty,
Speaker 4: it's a whole lot better to start when you're in thirty,
Speaker 4: forty to fifty or sixty.
Speaker 2: And on the drug front, you mentioned way give you
Speaker 2: ezempic briefly earlier. But that seems to me to be,
Speaker 2: from what we understand so far, to be an antholute
Speaker 2: game changer in allowing people to age well. In that
Speaker 2: if it really can deal with a large part of
Speaker 2: the obesity problem, and if the benefits to the heart
Speaker 2: that we keep hearing about or turn out to be correct,
Speaker 2: then that's something of a game change. It to people
Speaker 2: who have not yet aged well, and I'll say, oh,
Speaker 2: I don't know, fifty six or whatever thing it feels
Speaker 2: damn he said, I should, you know, take more exercise diet,
Speaker 2: except twenty years ago I did. GLP one is a
Speaker 2: drug that I've taken it.
Speaker 4: But I think what's really interesting about them is there
Speaker 4: a signpost where we're going to be going in terms
Speaker 4: of treating health. In the book, I stress that we
Speaker 4: don't really have a health system at the moment. We
Speaker 4: have a system that treats disease. And I use that
Speaker 4: great quote by wh Jordan that health is something that
Speaker 4: medicine knows nothing about. And I was saying that to
Speaker 4: a cardiologist the other day and they said, no, no, health
Speaker 4: is just an incomplete diagnosis. Something will happen and then
Speaker 4: we can do something about it. But we don't really
Speaker 4: know how to maintain health. But because we focus on disease,
Speaker 4: that's a really big problem with what's happening is we
Speaker 4: live our longer lives because we're now vulnerable to aging
Speaker 4: related diseases. And it's a bit of a dismal litany,
Speaker 4: but cardiovascular disease, dementia, diabetes, arthritis, cancer, all of these,
Speaker 4: the biggest risk factor is aging. The older, we get
Speaker 4: them more like we are to get them. So if
Speaker 4: you sort of tackle one of those diseases, say cancer,
Speaker 4: you've still got the risk of all the other ones.
Speaker 4: So your health is still impaired. Your life expectancy is
Speaker 4: still curtailed. But if we can sort of go upstream
Speaker 4: and focus on the aging process itself and age better,
Speaker 4: whatever that means in terms of biological aging, then you
Speaker 4: have a huge benefit downstream on multiple diseases, which is
Speaker 4: a huge benefit because then sure you're going to live longer,
Speaker 4: but crucially going to be healthier for longer because you
Speaker 4: push back all these multi morbidities. Mate. That's where the
Speaker 4: gop one drugs are very interesting, because what they're saying
Speaker 4: is I'm not going to tackle a disease, I'm going
Speaker 4: to tackle a biomarker, in this case obesity. And obesity
Speaker 4: you can have an argument whether it's a disease or not,
Speaker 4: but I'd rather avoid that one. It's clearly an indicator
Speaker 4: of bad future health. And so if you can tackle
Speaker 4: that biomarker, you're going to have a benefit on multiple diseases.
Speaker 4: And if you look at some of the sort of
Speaker 4: evidence coming through, it looks like it's good for cardiovasca,
Speaker 4: it could be good for kidney disease, it looks like
Speaker 4: it's good for diabetes, and that's where it's a real ganger,
Speaker 4: because that's a step towards preventative health, where I'm maintaining
Speaker 4: my health for longer and pushing back getting diseases, and
Speaker 4: that's really what we need to do.
Speaker 2: Okay, let's talk a little bit about how you see it.
Speaker 2: The health service transforming from what we might call a
Speaker 2: misery service into a health service. Would how would that work?
Speaker 2: What would for example, the NHS do if it were
Speaker 2: to change the way it approaches things. What would it
Speaker 2: look like in your mind?
Speaker 4: So clearly you still need something of an NHS which
Speaker 4: looks at diseases and intervenes, but you can see it
Speaker 4: on its knees at the moment, and how many resources
Speaker 4: we throw at it, it's not going to deal with
Speaker 4: a growing number of older people who are getting age
Speaker 4: related diseases. So we need to stop the number of
Speaker 4: older people who are getting aging related diseases, and that's
Speaker 4: by getting to age more healthily. And that's a shift
Speaker 4: from intervention to prevention. So it could be things like GLP,
Speaker 4: but I think there's a whole host of shifts that
Speaker 4: need to occur. So let's start first of all with
Speaker 4: public health, which of course is not everyone's favorite, but
Speaker 4: one of the reasons we're living longer lives in the
Speaker 4: twentieth century is public health made huge improvements in reducing
Speaker 4: infant mortality by raising awareness of what needs to be
Speaker 4: done with young children it was successful, and reducing them
Speaker 4: hound to be a drink and how we smoke, all
Speaker 4: of which have had a benefit. And I think, you know,
Speaker 4: helping raise awareness, making it easier for people to do exercise,
Speaker 4: to eat healthily, for the environment to be cleaner, etc.
Speaker 4: It will be important and those social changes are in
Speaker 4: part inspired by public health. Then there's the health system
Speaker 4: itself which has to move towards prevention, and I think
Speaker 4: there there's going to be a shift out of hospitals,
Speaker 4: probably to something like the community. I think it's really
Speaker 4: interesting during COVID that we managed to do a four
Speaker 4: scale mobilization of preventative health outside in the main the
Speaker 4: GP and the NHS through using community spaces. So there
Speaker 4: may be things like vaccination. Clearly, if you look at
Speaker 4: the trouble we've got is that there's loads of diseases
Speaker 4: can get us. So in the book, I talk about
Speaker 4: how we can use huge advances in genetic screening, extraordinary
Speaker 4: developments in big data in AI, and say Andrew looking
Speaker 4: at your family history and your genetics. We think you're
Speaker 4: going to be particularly vulnerable to these diseases. We are
Speaker 4: going to concentrate on screening you for those. And you know,
Speaker 4: this is where I think the big revolution has to
Speaker 4: come from. I'm a little bit nervous about AI in general,
Speaker 4: but I think big data in healthcare and has huge
Speaker 4: potential to identify what are most at risk at and
Speaker 4: then design interventions around it.
Speaker 2: Okay, so you can say to people, this is what
Speaker 2: you're at risk of, and therefore this is how you
Speaker 2: should behave. But I'm not to hop on about obesity,
Speaker 2: but it's the classic one right where you can look
Speaker 2: at people who abes and we can say to them,
Speaker 2: this is what this puts you at risk at of,
Speaker 2: and this is how you should behave. But that doesn't work.
Speaker 2: And this is why I'm interested in what you mean
Speaker 2: when you say turning it into a preventative service rather
Speaker 2: than a treatment service, because we have a long history
Speaker 2: of knowing that people don't change their behavior when they're
Speaker 2: given an alert about something that affects them specifically.
Speaker 4: I agree, So I do think there is scope for
Speaker 4: education and for people to have agency. It's interesting how
Speaker 4: at least. Some of my readings of the work around
Speaker 4: these GLP one drugs, like wegov is as people whose weaight,
Speaker 4: they start to get a sense of agency and feel
Speaker 4: they can carry that over into other areas of what
Speaker 4: they do, which I think is interesting. So I don't
Speaker 4: want to totally rule out the ability to change your behavior,
Speaker 4: but I think you're right in general, it's going to
Speaker 4: be easier to have it through a drug. And so
Speaker 4: you know, is vaccinations prevention or is it intervention? But
Speaker 4: I think we will see more and more vaccinations which
Speaker 4: can be useful in bringing down obesity, blood pressure, etc.
Speaker 4: So there will definitely be treatments. I think also we
Speaker 4: may well see a ship and I think this would
Speaker 4: be controversial, but I'm an economist. I think incentives are
Speaker 4: very important, and so there may even be some monetary
Speaker 4: incentives to change your behavior. If you deliver on these things,
Speaker 4: then we'll give you some money or resources, because after all,
Speaker 4: the NHS will be a net saver. And I do
Speaker 4: think that's one of the really big shifts that's got
Speaker 4: to occur. So I think we need to really embed
Speaker 4: it within government a target for healthy life expectancy. I
Speaker 4: for instance, think the state pension age should be indexed
Speaker 4: on some concept of healthy life expectancy. You cannot expect
Speaker 4: people to work for longer if their health is not sustainable,
Speaker 4: and I think we then have an incentive to invest
Speaker 4: in health outcomes rather than treating disease outcomes, and I
Speaker 4: think you need to then also embed that in the
Speaker 4: NHS to ensure that you get better outcomes. I also
Speaker 4: think we probably with an aging population, have to recognize
Speaker 4: that as we have more people aged fifty to let's
Speaker 4: say seventy, the health of those individuals is going to
Speaker 4: be crucial for the economy. Because one of my hobby
Speaker 4: horses is to try and stress the governments that you
Speaker 4: can increase the state pension age. But in the UK
Speaker 4: only about a quarter of people are working at the
Speaker 4: current state pension age, so you're not really going to
Speaker 4: have a big effect. They aged round fifty, about eighty
Speaker 4: percent of Brits are working. By sixty five before the
Speaker 4: state pension age is down to about twenty five thirty percent.
Speaker 4: So how do you stop that really big decline? And
Speaker 4: I think part of that is around preventative health, and
Speaker 4: I think at the moment we tend to assume the
Speaker 4: money we spend in the health system is just a cost.
Speaker 4: And it's nice to have better health, but it's just
Speaker 4: a cost. But increasing it with aging populations we're going
Speaker 4: to see actually, it's going to be crucial for economic growth.
Speaker 4: There's not much productivity growth in the UK at the
Speaker 4: moment or many other rich countries. So most of GDP
Speaker 4: growth is employment growth, and most employment growth is workers
Speaker 4: aged over fifty. And the more we can keep workers
Speaker 4: aged over fifty working, the better it is for GDP.
Speaker 2: I want to go back briefly to what you said
Speaker 2: about it incentives mattering. You for John and I say
Speaker 2: all the time on this podcast, incentives matter, for God's say,
Speaker 2: why can't people realize that incentives matter? Give people the
Speaker 2: right incentives, they'll do you want, Give them the wrong ones,
Speaker 2: they definitely won't. There have been some trials around health
Speaker 2: and incentive payments, haven't they, and they have work exactly.
Speaker 4: I think, you know, it's hard to change thinking, and
Speaker 4: of course, wouldn't it be great if people didn't need
Speaker 4: a financial incentive to change their behavior. I also think,
Speaker 4: you know, if you think about the incentives to how
Speaker 4: we do change in the NHS, you know there's a
Speaker 4: couple of problems, and some of these are even more
Speaker 4: acute in America. There's that up to in Sinclair quote
Speaker 4: that it's very difficult to get someone to change their
Speaker 4: mind when their livehood depends upon them not shifting their
Speaker 4: mind and not changing what they do. But I also
Speaker 4: think another challenge is that when you rise to the
Speaker 4: top of a profession with an existing skill set, it's
Speaker 4: very hard to then say, right, I'm going to give
Speaker 4: up on that because the way the future is something different.
Speaker 4: And so when we have an nhsy's geared around intervention,
Speaker 4: it will take a very big mindset to shift towards prevention,
Speaker 4: which is why I suspect we have to do something
Speaker 4: outside of the NHS, which will lead to all sorts
Speaker 4: of financing issues, because how is the treasure you're going
Speaker 4: to finance prevention and intervention at the same time. But
Speaker 4: the economic return on investment for prevention is quite considerable.
Speaker 4: The other thing we haven't really discussed myriory is that
Speaker 4: us as individuals we go along and say, hey, I
Speaker 4: not very well do something about it, But when it
Speaker 4: comes to prevention, we are going to have to be
Speaker 4: a lot more active ourself.
Speaker 2: Yeah, that's the challenge. Right, Let's move on to how
Speaker 2: on earth we pay how do we finance a world
Speaker 2: when everyone's on a path to eighty five, ninety, possibly
Speaker 2: one hundred. Now, we have a system globally where you
Speaker 2: are educated for maybe eighteen years, maybe twenty two years,
Speaker 2: maybe twenty five years, maybe twenty eight years, whatever it is.
Speaker 2: Increasingly more and more years you're educated for, and then
Speaker 2: you work for thirty or thirty five years, get your
Speaker 2: state pension and the pentin that you build up inside
Speaker 2: your your work environment, et cetera, all to enrollment we
Speaker 2: have today lovely, and then you hit hopefully sixty maybe
Speaker 2: sixty five, and you retire. Now, I know that you
Speaker 2: and academics and economists like you think that the best
Speaker 2: thing for us to do is to change the way
Speaker 2: we do that, to not have these kind of solid
Speaker 2: blocks of time dedicated to education, work, retirement. But that's
Speaker 2: a difficult thing to persuade people, because when they've been
Speaker 2: working for thirty thirty five years, quite like to stop.
Speaker 2: So come the age when they and get their hands
Speaker 2: on their bension.
Speaker 4: Yes, please, no, completely, there's a whole bunch of issues
Speaker 4: you raised there let's begin by you know, it's just
Speaker 4: a simple matter of arithmetic. If we're living for longer,
Speaker 4: we need more resources. We have to produce more resources
Speaker 4: ever our lifetime. And it may be AI is going
Speaker 4: to come charging to the rescue and give us all
Speaker 4: those resources so we don't have to you know, the
Speaker 4: problem solved, But if it doesn't, we have to be
Speaker 4: more productive over our lifetime. So it's very hard to
Speaker 4: move away from the notion that we'll have to work
Speaker 4: for longer. And that's just an adding up constraint. Now,
Speaker 4: that doesn't mean that everyone has to work for as
Speaker 4: long as they feasibly can. I think we're going to
Speaker 4: see a great deal of variety in hytergeneity because of course,
Speaker 4: not everyone can have the same life expectancy. Not everyone
Speaker 4: can find it so easy to work. So we really
Speaker 4: have already I think seen retirement as a com concept
Speaker 4: change phenomenally. It's no longer there's a single age where
Speaker 4: everyone comes to a hard stop at work. It's a
Speaker 4: continual process. Some people work for a long time, some
Speaker 4: people stop working before the current retirement age. Some people
Speaker 4: are working part time beforehand or part time afterwards. Some
Speaker 4: people unretired so I think we're seeing a great deal
Speaker 4: of flexibility and variety. But you're quite right. My challenge
Speaker 4: is with governments who just set out to raise the
Speaker 4: state pension age, because I don't think that solves the
Speaker 4: problem at all. It solves a government problem, which is, oh,
Speaker 4: i'll pay less in pensions, but it does nothing to
Speaker 4: keep us productive for longer. And so my concept of
Speaker 4: the evergreen society is how do we stay healthy and
Speaker 4: productive for longer. Now, some of that is about preventative
Speaker 4: health and just what we've talked about. There also be
Speaker 4: a need for lifelong learning and education. As you said,
Speaker 4: we're getting more and more education. I don't think it
Speaker 4: necessary has to be about going back to college. It
Speaker 4: could be something you learn on YouTube. You just got
Speaker 4: to keep updating your skills. But there's another challenge, which
Speaker 4: is can you keep working in your job? So you
Speaker 4: know it's a convest The way I look at this
Speaker 4: is it's sort of you know you're going to want
Speaker 4: to carry on working if the gains are staying in
Speaker 4: work ex seed the costs of gain to work, and
Speaker 4: for many people, if you're ill and work is very
Speaker 4: physically challenging or very boring, you don't want to carry
Speaker 4: on working and totally you know, I get that, but
Speaker 4: of course there's an adding up constraints. So how do
Speaker 4: we create what I call age friendly jobs, which are
Speaker 4: jobs that older people are able to do. Now I'm
Speaker 4: a university professor, that's pretty easy for me, and I've
Speaker 4: done some work on this and the number of age
Speaker 4: friendly jobs, jobs which are more flexible, provide moral autonomy
Speaker 4: and less physically demanding. Actually that's the work trend. More
Speaker 4: and more jobs are getting like that. But if you're
Speaker 4: working as a construction worker, if you're working in a
Speaker 4: very physical activity, that's not an option. So I do
Speaker 4: think we've got to think about how we support people
Speaker 4: in shifting careers when they get to a point where
Speaker 4: they can no longer what they used to do. And
Speaker 4: we do this all sorts of ages when we have
Speaker 4: active labor market policies. And you know, if you're a
Speaker 4: construction worker, you may not be able to carry on
Speaker 4: working in something physically, but there should be all sorts
Speaker 4: of skills that you have depending upon the person to
Speaker 4: shift into something you can carry on doing.
Speaker 2: What like what like what I'm sorry to challenge you,
Speaker 2: but like what I keep Hearing this idea that people
Speaker 2: will what end a career working in Tesco's, which they
Speaker 2: loathed anyway, and somehow move on to some other sound
Speaker 2: part time, don't believe it, and I don't understand how
Speaker 2: you facilitate a world in which there is attractive work
Speaker 2: for people to do after they've spent thirty years doing
Speaker 2: unattractive work. If that attractive work existed, they've done it
Speaker 2: in the first place.
Speaker 4: Well, well, let me just begin by saying I'm a
Speaker 4: no fan of just raising the state pension age. I
Speaker 4: think it should be indexed on not even average healthy
Speaker 4: life expectancy, but something lower down the distribution, because to
Speaker 4: get people who are in poor health and tired to
Speaker 4: carry on working is a terrible thing. So I absolutely
Speaker 4: agree with that. I also think there are ways that
Speaker 4: we can support people, and I think, give me give
Speaker 4: an example. My father and law as America, used to
Speaker 4: be a truck driver and then they try only went
Speaker 4: to move and worked for a charity helping older people.
Speaker 4: And he's got great personal skills. It's not something that
Speaker 4: he requires a huge physical strength for, and so I
Speaker 4: think that's perfectly possible to do. I'm not saying you
Speaker 4: have to punish people to do it. I'm not saying
Speaker 4: that you have to push people into bad jobs, but
Speaker 4: I think there are skills that people doing physical and
Speaker 4: manual jobs have got. They perhaps used to enjoy the
Speaker 4: camaraderie of physical work but no longer do. But they
Speaker 4: want to do something where they use their other skills.
Speaker 4: And I don't think that's about learning how to be
Speaker 4: a full stack developer in terms of software code. I
Speaker 4: completely agree on that. One of the problems with lifelong
Speaker 4: learning is that the people who did it later in
Speaker 4: life tend to be the people who did it earlier
Speaker 4: in life. But I think there's other ways you can
Speaker 4: learn skills, including shifting from being a construction worker to
Speaker 4: perhaps helping out in a care home, which I think
Speaker 4: are perfectly feasible. And I think that, you know, I
Speaker 4: don't know for some people, I held hope that was
Speaker 4: a rewarding shift, But I agree with you. We can't
Speaker 4: have bad jobs. We don't want people condemned to do
Speaker 4: bad jobs.
Speaker 2: It just always seems to me that when we talk
Speaker 2: about this kind of thing, we're really talking about the
Speaker 2: likes of you and me.
Speaker 4: Well, this is why I sort of call it, you know,
Speaker 4: the sort of Sam Beckett theey of retirement, which is,
Speaker 4: you know, I can't go on, I must go on,
Speaker 4: a type of approach which is just dismal. So the point,
Speaker 4: you know, this book, The Longevity impairt says we underestimate
Speaker 4: the capacity of old people. We underest the capacity of
Speaker 4: eighty years. And that's a problem because we're living longer
Speaker 4: and we have to rise to the challenge to support
Speaker 4: those lives, to make sure that they're healthy, productive, and
Speaker 4: engaged for all. And we sort of did that at
Speaker 4: early years, so there's no reason we shouldn't be able
Speaker 4: to do it at older years. But it does require
Speaker 4: a big rethink, and a big rethink it involves a
Speaker 4: lot more than just saying, hey, I'm just going to
Speaker 4: whack up the state pension age, because that does nothing
Speaker 4: to keep people healthy, productive, and engage for longer. That's
Speaker 4: just a route to misery. So in some ways I
Speaker 4: completely agree, Mary, and I think your challenge is a
Speaker 4: good one, which is raising the state pension age easy
Speaker 4: for those people already working beyond the state pension age,
Speaker 4: but it's futile because the large majority of people can't
Speaker 4: and they need support and help. But we have education,
Speaker 4: health policies, and active market policies a younger age. Why
Speaker 4: don't we do it at older age because we underestimate
Speaker 4: the capacity of older people.
Speaker 2: We could just leave old people alone or older people
Speaker 2: alone and work on the fertility rate. Yeah.
Speaker 4: So, well, a couple of issues. So first of all,
Speaker 4: I think this is a big change when I talk about, oh,
Speaker 4: you know, it's going to be individuals. It can be
Speaker 4: government policies, it can be firms, social customs. And I'm
Speaker 4: certainly not trying to direct what people do. I think
Speaker 4: you need to give people support so they got choices now.
Speaker 4: In terms of raising the fertility rate, I just don't
Speaker 4: think it's going to happen. I think it was hungry
Speaker 4: where if you have more than four kids, a woman
Speaker 4: doesn't pay income tax, which is a pretty big financial incentive.
Speaker 2: Doesn't seem to I've done it for that, I've definitely.
Speaker 4: In general, it doesn't seem to have much of a response.
Speaker 4: My big thing is not that we've got to make
Speaker 4: people work for longer, or you know, or anything of
Speaker 4: that form. The question is we got all these extra years,
Speaker 4: what do we do with them, and what do we
Speaker 4: do before then to support that longer life. And the
Speaker 4: simple story is, we've created a society where, you know,
Speaker 4: in the past, only a minority of people live to
Speaker 4: be ninety. So we haven't built the institutions to support
Speaker 4: a longer life, which is why we say, oh, my goodness,
Speaker 4: look at this aging society. Probably I'm always struck by
Speaker 4: the reference to aging society. I don't know anyone goes, yeah, brilliant,
Speaker 4: We've got an aging society. In some ways, it's one
Speaker 4: of the greatest achievements of the twentieth century. Fewer infants
Speaker 4: lost in early life, fewer parents snatched away in midlife,
Speaker 4: more grandparents meeting their grandchildren. But we refer to it
Speaker 4: as an aging society. And when it comes to AI
Speaker 4: and climate change, we talk in engaged way about how
Speaker 4: we adapt and adjust to make the most of this
Speaker 4: longer life. When it comes to age, anxiety would just say, oh,
Speaker 4: these old people, they can't work, they're real, they need
Speaker 4: a pension and they're a burden. That's a crazy situation
Speaker 4: when the majority of us can expect to become old.
Speaker 4: So how do we change? How are we aged?
Speaker 2: Is there any are there any lessons we can learn
Speaker 2: from Japan who seem to be managing this aging economy
Speaker 2: very well. There was a little ahead of the rest
Speaker 2: of us on everything.
Speaker 4: Yeah, I think there's something in that. So first of all,
Speaker 4: I always I trustingction between changes in the age structure
Speaker 4: and then changes and how long we live. And Japan
Speaker 4: has got a really aggressive, similar to China, change in
Speaker 4: his age structure in a way that the UK and
Speaker 4: US don't. I mean, we are seeing a change in
Speaker 4: our age structure, but our fertility rate has fallen by
Speaker 4: less and more slowly, so we haven't got the same
Speaker 4: really dramatic change in age structure that Japan and China
Speaker 4: have got with their declining population, and we use immigration more.
Speaker 4: But yeah, I think China Japan is a good example.
Speaker 4: I think they've done well at instigating a sort of
Speaker 4: these age friendly jobs where there's options to work part
Speaker 4: time and flexibly as you get older, which I think
Speaker 4: is a really good thing. You know, going back to
Speaker 4: our conversation about retirement, I think a point I want
Speaker 4: to try and make is that in the twentieth century,
Speaker 4: when we created that three stage life that you refer to, education,
Speaker 4: work and retirement, as we lived longer, we took more
Speaker 4: and more leisure after retirement. I think as we live
Speaker 4: longer now, we're going to take more and more leisure
Speaker 4: this side of retirement through part time work and possibly
Speaker 4: even career breaks. But that's another topic. But Japan has
Speaker 4: done very well I think creating those flexible age for
Speaker 4: any jobs. It's also done a pretty good job on
Speaker 4: diet and health, but inequality in particular, I think is important.
Speaker 2: Let's then talk about how we can make some of
Speaker 2: the things you're discussing, how it can translate into actual
Speaker 2: policy that can really help.
Speaker 4: I want to step back a little bit here, because
Speaker 4: what my book says is that this is a really
Speaker 4: profound moment for humanity. Actually, and I'm always wearing a
Speaker 4: business called profess to talk about living through a time
Speaker 4: of unparallel change, because in general, I think that's nonsense.
Speaker 4: But when the first time ever in human history, the
Speaker 4: young can expect to live into their tenth decade, when
Speaker 4: global life expectancy is now over seventy global life expectancy,
Speaker 4: that's a fundamental shift. We can now all expect to
Speaker 4: become old, and that is going to require some pretty
Speaker 4: deep seated changes that won't come through immediately. But just
Speaker 4: as the twentieth century saw us invent teenagers. We saw
Speaker 4: us invent retirement and pensioners. It invented the midlife crisis,
Speaker 4: invented the weekend. That's a whole mixture of government practice,
Speaker 4: social norms, all of which occurred over several decades that
Speaker 4: I think is a process that we will see as
Speaker 4: we adapt to these longer lifes. So some of it
Speaker 4: it's going to take a long while. And I hope
Speaker 4: I sort of type define myself as a patient optimist,
Speaker 4: although the world is testing me sorely on the optimism
Speaker 4: these days. But you know, these changes do happen. But
Speaker 4: what can we do in the very very short term,
Speaker 4: And you know, I've already sort of touched on what
Speaker 4: I think the main ones urgently shifting to a system
Speaker 4: of preventative health. It's the only way to save our
Speaker 4: health systems, the only way to safeguard our economy. And
Speaker 4: there are plenty of very simple, relatively cheap things we
Speaker 4: can do to keep us healthy for longer. And not
Speaker 4: only is that incredibly valuable because health is our most
Speaker 4: important ast the thing we value the most, it's also
Speaker 4: crucial for the economy. When you have a rise the
Speaker 4: fastest growing population is those aged over fifty. So absolutely
Speaker 4: a focus on preventive health. Some of that I think
Speaker 4: we'll have to be done outside the NHS. That's about incentives.
Speaker 4: I think it's about a target for healthy life expectancy,
Speaker 4: because that's the key part of the Longevity Imperative book
Speaker 4: is we've got a system that's done really well in
Speaker 4: credding us to live for longer. We've slowed down the
Speaker 4: dying process. We haven't slowed down the aging process, and
Speaker 4: that is what we have to focus on because right now,
Speaker 4: these long lives, the gap at the end of life
Speaker 4: between when we're healthier not is getting wider. We're getting
Speaker 4: more years and good health, but more years in bad health,
Speaker 4: and that has to be a number one priority. And
Speaker 4: nowhere is that a target right now. So a healthy
Speaker 4: life expendence is a target. How do you then increase
Speaker 4: the incentives to do that? I would say make the
Speaker 4: state pension ager function of healthy life expectancy. So then
Speaker 4: the Treasury have an incentive to say, you know what,
Speaker 4: I'm not just going to give you a big check
Speaker 4: to spend on the NHS. I want you to deliver
Speaker 4: outcomes that actually boost the economy by keeping people in
Speaker 4: work and keeping them healthy. And that's not about pushing
Speaker 4: them beyond sixty five. I think that's an unfair bargain
Speaker 4: to ask of people. If you haven't got the skills,
Speaker 4: you haven't got the health and the opportunities, you should
Speaker 4: not be forced to work beyond that. So we've got
Speaker 4: to make sure we get those age fifty to sixty
Speaker 4: six sixty seven, which is the current state pensione age healthy,
Speaker 4: fit and engage. That seems a very fair political bargain.
Speaker 4: So that would be some of the very concrete things
Speaker 4: that I would do.
Speaker 2: Okay, And for the individual looking at their finances, how
Speaker 2: do you look at your finances over a career like
Speaker 2: this or a life like this?
Speaker 4: Yeah, so of course that's at managing industry will just
Speaker 4: tell you to save more, which I don't actually think
Speaker 4: is the right.
Speaker 2: So always save more, save more, exactly.
Speaker 4: So you know, it's not an easy problem is they're
Speaker 4: trying to work out your finances because you need to
Speaker 4: know how long you could likely to live for, which
Speaker 4: is really uncertain and increasing. You've got to be able
Speaker 4: to guess how long you can work for. And one
Speaker 4: of the things I always warn people about is always
Speaker 4: I'm fine, and if I can make it to retirement age.
Speaker 4: But you know, let me go back to that scary statistic.
Speaker 4: Eighty percent of people are working at fifty, only about
Speaker 4: thirty percent by sixty five, and most of those are
Speaker 4: not voluntary exits from the labor market. It's they get ill,
Speaker 4: they have to care for someone as ill, they deem
Speaker 4: not have the skills, updated skills, or there's just pure
Speaker 4: agism in the workplace. So you've got to know how
Speaker 4: long you live for, how long you can work for,
Speaker 4: how much money you need and you retire, and what
Speaker 4: the rate of return is in your earnings. There's no
Speaker 4: simple solution to that. I think saving more possibly is
Speaker 4: the answer, but it all depends. As you said. You know,
Speaker 4: some people like the university professors, very happy to carry
Speaker 4: on working for longer. I suspect you may be in
Speaker 4: that situation as well, Marin, in which case, if you're
Speaker 4: going to work for longer, you can actually save less
Speaker 4: because if you keep your years of retirement fixed as
Speaker 4: they were before life expectancy increased, you've got a longer
Speaker 4: time to earn the money, so you can save less.
Speaker 4: If you want to retire for longer, you've got to
Speaker 4: save more. But I think we're going to see a
Speaker 4: great deal of heterogeneity in how people respond to it.
Speaker 4: But the key in all of this, I think is
Speaker 4: it's not just a financial issue. It's very hard to
Speaker 4: avoid the conclusion that basically also have to invest in
Speaker 4: your human capital, because if you've got the health, if
Speaker 4: you've got the skills and the purpose, if your financial
Speaker 4: plans go awry, you can still earn some money to
Speaker 4: bring them back on track again. And I think that's
Speaker 4: the really, really big change. The other thing I think
Speaker 4: we'll see as a new financial system, we need much
Speaker 4: more personalized finance. That three stage life where everyone had
Speaker 4: the same retirement age and the same needs doesn't work
Speaker 4: over this longer life where people will have very different aims,
Speaker 4: very different preferences, very different circumstances. I think we also
Speaker 4: need to see a much more joint thinking about health
Speaker 4: and wealth. I think we'll see more and more life
Speaker 4: insurance companies saying, hey, I make money if you could
Speaker 4: live longer. How can I make that happen? Or there's
Speaker 4: all these new treatments coming along, our start to try
Speaker 4: and integrate those together. And then the other really big issue,
Speaker 4: which I think is not dealt with at the moment
Speaker 4: is the way I call living insurance. We saw life
Speaker 4: insurance develop in the eighteenth nineteenth century, which was you know,
Speaker 4: if you die early, your family is protected. The problem
Speaker 4: we got now is not just increases an average life expectancy,
Speaker 4: but actually most people live longer than the average. The
Speaker 4: mode is above the average. You've only got about I
Speaker 4: think a three percent chance of dying at the average
Speaker 4: life expectancy. So you have a very high chance of
Speaker 4: living beyond your average life expectancy. And one thing is
Speaker 4: can you save enough to live to eighty eight eighty nine?
Speaker 4: But how do you save enough if you're going to
Speaker 4: be living to one hundred and one hundred and five
Speaker 4: And I don't think you can save that much. And
Speaker 4: so we need, whether it's annuities or ton teens, we
Speaker 4: need new instruments that can help us ensure against that variation.
Speaker 2: Well, I was going to say that just sounds like
Speaker 2: a late life annuity, which is something that is beginning
Speaker 2: to get popular, where people they buy an annuity when
Speaker 2: they hit a certain age and rather than buying it
Speaker 2: directly at sixty five or retirement ages, just doing the
Speaker 2: old days. Now you you know, you live off your
Speaker 2: pot for a while, and then when you hit a
Speaker 2: certain age and you're not entirely shure was going how
Speaker 2: long you might live after that, you buy an annuity to
Speaker 2: keep yourself safe after that. I'm I'm not sure Tom
Speaker 2: teams are going to take take off again.
Speaker 4: No, I think they're more part of max finance professors
Speaker 4: and novelist than people. But they are there, are lovely,
Speaker 4: They've got some advantages in them. So perhaps some sort
Speaker 4: of a hybrid between a tontine and a newity might work.
Speaker 2: Oh, there's a column in that. All right, Andrew, last
Speaker 2: question here you are. Let's say we're getting getting towards
Speaker 2: the end. Yeah, we're quite old, and we're thinking to ourselves.
Speaker 2: I'm worried about inflation over the ten years, Whor I'm
Speaker 2: worried about all sorts of things over the cooming ten years.
Speaker 2: You have political difficulties, etc. And I want to buy
Speaker 2: one asset, one acid only that I think will protect
Speaker 2: me very well over those ten years. And I've only
Speaker 2: got two choices. I've got gold or I've got bitcoin.
Speaker 2: What am I going to buy?
Speaker 4: Well, I'll go for gold because I don't know if
Speaker 4: it depends on next Tuesday or Thursday in ten years
Speaker 4: time whether bitcoins are going to be high or low
Speaker 4: in price. It's just too volatile. So I'd go for
Speaker 4: gold because gold is this sort of sort of tangible
Speaker 4: commodity that we all think is valuable even though we
Speaker 4: don't really know why it is, whereas bitcoin and this
Speaker 4: an intangible commodity that I've got no idea what it's about.
Speaker 4: So I would go for gold personally.
Speaker 2: Okay, brilliant, thank you very much. You do know and
Speaker 2: I'm sorry to have to tell you this that this
Speaker 2: will get you attacked on Twitter. John, What do you
Speaker 2: think about what Andrews says? I know that obviously you're ready, young,
Speaker 2: sin aneimous, remotely relevant to you.
Speaker 1: But I know that you eat well, you.
Speaker 2: Exercise, You've got good friendships, good relationships and nice community
Speaker 2: structuring excise. So you're probably going to live and tell
Speaker 2: you all what five.
Speaker 3: You have to a lot of ten years for being
Speaker 3: born in Glasgow.
Speaker 2: Yeah, you do, although you have left Glasgow, which may
Speaker 2: be helpful to you in that sense.
Speaker 3: Obviously, I think this is a really interesting topic and
Speaker 3: the I think the one thing the conversation kind of
Speaker 3: very made very clear is that this affects everything, and
Speaker 3: an awful lot of the you know, the recommendations involve
Speaker 3: almost like restructure so many aspects of basically basically a
Speaker 3: public sector because one thing I don't know. I was
Speaker 3: talking about wearables to my wife the other day, as
Speaker 3: you know, like you know, watches that can monitors your
Speaker 3: your health, and she has worked in the NHS in
Speaker 3: the past, and one of the points was that integrating
Speaker 3: the kind of data and the kind of warnings and
Speaker 3: the things that your Apple watch will give you with
Speaker 3: the actual service you can expect from the NHS is
Speaker 3: extremely difficult because you know, either people kind of getting
Speaker 3: a wee warning from our Apple watch that maybe they
Speaker 3: should go and get an EK you know, an electro
Speaker 3: cardiograph because their heart had done something a bit funny
Speaker 3: in the night or whatever. But then you get the
Speaker 3: doctors getting frankly pissed off that people are kind of
Speaker 3: coming and requesting you know, these e cages even though
Speaker 3: actually a lot of time when you did one on them,
Speaker 3: you actually did find something. So I think there's a
Speaker 3: there's like an infrastructure issue here more than a tech
Speaker 3: issue at this point for health.
Speaker 2: Yeah, or is there a doctor's getting pissed off at
Speaker 2: persive perfectly reasonable requests issue.
Speaker 3: Yeah, that's what I mean. It's yeah, if you've got
Speaker 3: an NHS, So if you've got a health system that's
Speaker 3: set up on the basis that there is a limited
Speaker 3: amount of paie to go around, then everyone that works
Speaker 3: in it is a gatekeeper. And unfortunately that's the nature
Speaker 3: of a ration health service. I'm not saying that, you know,
Speaker 3: the US alternative is necessarily better, but you'll be doing
Speaker 3: that you look at how how we structure there's and
Speaker 3: also about the can over the kind of mentality I
Speaker 3: think of the health service as well.
Speaker 1: Well. I think that's the key bit, isn't it.
Speaker 2: I'm one of the things that Andrew talks about a
Speaker 2: lot is about how we call it a health service, but.
Speaker 1: Of course it's not a health service at all.
Speaker 2: It's a misery service, and illness service and disease treatment
Speaker 2: service is absolutely not a health service.
Speaker 1: And we need to find a way to make.
Speaker 2: What we call our health service do something about preventative health,
Speaker 2: about getting people to look after themselves better before they
Speaker 2: turn up at the NHS. But this is this is
Speaker 2: where I you know, where do come and slightly come
Speaker 2: into conflict with Andrew on this and on the event
Speaker 2: that we talked about during the conversation. We talked about
Speaker 2: this idea that people should spread their working life out
Speaker 2: more thinly, that they should take more sobaut are girls
Speaker 2: and more breaks, that they should change career more often,
Speaker 2: all this kind.
Speaker 1: Of thing, And these are all things that some people
Speaker 1: will do.
Speaker 2: Some people will do, but an awful lot of people
Speaker 2: either won't or can't. And we know, for example, you know,
Speaker 2: you and I have talked quite a lot about the
Speaker 2: weight loss drugs and the impact that they have and
Speaker 2: how brilliant we think they are, notwithstanding side effects that
Speaker 2: may appear over the itst couple of decades. But you know,
Speaker 2: if diets worked, if this whole idea that you could
Speaker 2: eat less and move more exactly, if that worked and
Speaker 2: it was relatively straightforward.
Speaker 1: Everyone would do it. Everyone would do it.
Speaker 4: Right.
Speaker 2: If that has worked, only one diet book would be required.
Speaker 2: But there are hundreds of thousands of diet bogs and
Speaker 2: millions bought every week, so we know it doesn't work.
Speaker 2: So we know that a preventative health service may only
Speaker 2: work for a very small percentage of people. Everyone else
Speaker 2: needs drugs, And it's the same. It's the same with work, right,
Speaker 2: this idea that you can work in one thing for
Speaker 2: twenty years and another lifting for ten years, another thing
Speaker 2: for thirty or five years, whatever it is, and you
Speaker 2: can spread yourself.
Speaker 1: Then and you can relearn, etc.
Speaker 2: And we were talking I'm not sure doing the recording,
Speaker 2: but after recording at about the way that people do
Speaker 2: change careers in older age. And Andrew was talking about
Speaker 2: someone he knew he'd worked in construction initially and later
Speaker 2: gone on to care homework. And I was talking about
Speaker 2: this with some people later, and someone.
Speaker 1: Said, you know, who would want to do that?
Speaker 2: Who would want to spend thirty years working construction and
Speaker 2: then instead of just relaxing.
Speaker 1: And resting for twenty years, go and work any care home.
Speaker 1: Why would that work for anybody?
Speaker 2: It works for intellectuals, It works for people whose job
Speaker 2: is sitting in front of a computer writing fund stuff,
Speaker 2: and then they can maybe write a different kind of
Speaker 2: fun stuff later.
Speaker 1: But does it really work for the majority of the population.
Speaker 2: All the stuff sounds great, sounds very desirable, and then
Speaker 2: you think, I just don't see how we get from.
Speaker 1: Here to that.
Speaker 3: Yeah, And I mean I guess. Still, the problem is
Speaker 3: you can't I don't think you can really make prescriptive
Speaker 3: for this because, as you say, I mean, career changes
Speaker 3: sound attractive, but they're they're very expensive to do, you know.
Speaker 3: I mean the main reason for the kind the pay
Speaker 3: gap between the sexes is because women go and have
Speaker 3: children and then that kind of breaks up their career
Speaker 3: and then recovering from that never happens. So the idea
Speaker 3: that you can go away and retrain for a year
Speaker 3: as a lawyer or something like that, I mean, I
Speaker 3: know that hams in the States a lot more, but again,
Speaker 3: you have to generally have the money behind you already,
Speaker 3: and it is a you know, a sacrifice, So it
Speaker 3: is something that most people really can't afford, even if
Speaker 3: they were motivated to do it.
Speaker 2: And I suspect a lot of the ideas that you
Speaker 2: moved to lower status work, right. So you and you know,
Speaker 2: you've worked in a reallyatively high status job, maybe you've
Speaker 2: been in management or whatever it is, doing the main
Speaker 2: part of your career. Your earnings peak out at you
Speaker 2: normally in your mid forties, don't they, And then maybe
Speaker 2: you're retired from that career and then you go in
Speaker 2: to do something.
Speaker 1: Less challenging. Let's intellectually challenging.
Speaker 2: I suppose maybe you work in a shop, or you
Speaker 2: work on reception somewhere, whatever it is, you pick up
Speaker 2: a lower status job in a part time way in
Speaker 2: your late las. No, that's fine, But what if you
Speaker 2: were already working in one of those jobs. What if
Speaker 2: your actual job had being one of those jobs? Which,
Speaker 2: to be ver is most people right you work in
Speaker 2: a low status job for thirty years and then you're
Speaker 2: expected to work in another low status job. Or do
Speaker 2: we change the idea about what status at work is.
Speaker 2: It's just it's more socially complicated, more culturally complicated than
Speaker 2: I think the academic world likes to think krama being unkind.
Speaker 3: So I think one thing that we forget because we
Speaker 3: can think about life as being cyclical, and obviously it
Speaker 3: is cyclical in lots of ways, but we forget this
Speaker 3: is genuinely new. That haven't been this number of people
Speaker 3: getting old, living long enough to have a state pension
Speaker 3: or what we would consider to be a retirement. And
Speaker 3: it's happened very quickly. It's like literally in the last
Speaker 3: one hundred years. So I think none of us are
Speaker 3: used to it. We're already seeing changes. There's a lot
Speaker 3: more acknowledgment of the fact that if and I mean
Speaker 3: this does largely relate to men, because there's been men
Speaker 3: that have been retiring from those kinds of jobs. But
Speaker 3: you get to sixty five, you go into the golf course,
Speaker 3: you die by the time you're seventy because of a
Speaker 3: mixture boredom, loss of state, is drinking too much, and
Speaker 3: also that kind of stubborn sense that you've worked for
Speaker 3: forty years, you're never ever picking up, you know, a tool,
Speaker 3: or doing or having a boss ever again. And I
Speaker 3: think that the psychology has moved on from that. I
Speaker 3: think people acknowledge now that actually, whenever you retire, you
Speaker 3: still have to do stuff. You still have to have
Speaker 3: a routine. I guess what I'm saying is, I think
Speaker 3: we're all kind of grappling our way towards actually just
Speaker 3: how you live better in retirement. And probably the thing
Speaker 3: that the state should focus on is making sure that
Speaker 3: we're as healthy as possible within that or that we
Speaker 3: have the ability to use the already existing technology that
Speaker 3: could help us to live longer, and just make sure
Speaker 3: that we've got access to it. In a in a
Speaker 3: pleasant way, as opposed to having a basically shout at
Speaker 3: someone in a GP surgery until they give you what
Speaker 3: you want.
Speaker 1: Huh. That sometimes works, mind.
Speaker 3: You, Oh no, it usually does work. But it's a
Speaker 3: shame that if you don't have someone advocating for you,
Speaker 3: or somebody to shout on your behalf, then you are
Speaker 3: in deep trouble. Is the many, many scandalous reports that
Speaker 3: have come out in the last couple of weeks alone
Speaker 3: have demonstrated and I'm not going to delve into that,
Speaker 3: but it's not being happy reading now.
Speaker 2: What's the best thing we can do really is keep
Speaker 2: hoping for a massive productivity revolution that takes away a
Speaker 2: lot of the problems that we're discussing.
Speaker 1: But there is one other thing I wanted to.
Speaker 2: Pick up for we end is that we talk briefly
Speaker 2: when when Andrew and I are talking, we talk about
Speaker 2: what the individual can do to effectively ensure against their
Speaker 2: long life. Right, but a very rare occasion of ensuring
Speaker 2: against something brilliant, right, and he talks about he talks
Speaker 2: bad to some kind of living insurance and as I
Speaker 2: said to him on the thing, what we're really talking
Speaker 2: about is just a deferred annuity, and these haven't been
Speaker 2: around much in the UK that you can get them
Speaker 2: in various places. And this is where you simply buy
Speaker 2: an annuity, but you buy one that doesn't start for
Speaker 2: quite a long time, so you have your pensions freedom.
Speaker 2: You can use the majority of your pension money in
Speaker 2: whichever way you would like, but you pre buy an
Speaker 2: annuity that kicks in at an age that you want
Speaker 2: to be insured from. So say eighty five or possibly
Speaker 2: even ninety whatever it is. You say to yourself, Christ,
Speaker 2: I lived in ninety I'm really going to be a
Speaker 2: bit worried. So I buy this annuity that kicks in
Speaker 2: at ninety, eighty five, eighty seven, whatever it is, so
Speaker 2: that you know that should you live longer than expected,
Speaker 2: there's going to be a regular income coming in or
Speaker 2: sely that takes away from your part when you start
Speaker 2: your retirement.
Speaker 1: But that's insurance for you.
Speaker 2: So that's something that I think we should maybe look
Speaker 2: at a little further. You and I this whole deferred
Speaker 2: annuity industry.
Speaker 1: Is it growing, Who does it, how does it work?
Speaker 1: What does it cost? Interesting?
Speaker 3: Stuff that's fascinating. Actually, see I told.
Speaker 1: You it was interesting stuff.
Speaker 2: Are you making any changes to your lifestyle or your
Speaker 2: finances as a result of listening to Andrew speaking.
Speaker 3: I see, do you know weird enough? I started exercising
Speaker 3: a lot more this year, so it was priorly Andrews speaking.
Speaker 3: But getting to that age where you do start to
Speaker 3: free up at this stuff and start doing things you
Speaker 3: should have started doing maybe twenty five years ago, but
Speaker 3: it's never too late.
Speaker 1: So as you can start in your eighties.
Speaker 2: I mean, I've got a dolt just so I got
Speaker 2: out of the house and I'm sure that happened.
Speaker 3: And it's a weep part.
Speaker 1: Thank girl.
Speaker 2: Well, kind of an irritating one, to be honest, but
Speaker 2: you know, thanks for listening to this week's Marin Junks Money.
Speaker 1: We'll be back next week.
Speaker 2: In the meantime, If you like us, show, rate, review,
Speaker 2: and subscribe wherever you listen to podcasts, and keep sending
Speaker 2: your questions or your comments to Merin Money at Bloomberg
Speaker 2: dot net.
Speaker 1: We will address them, we promise. This episode asserted by me.
Speaker 2: Merrin Zumset Web is produced by Samasadi.
Speaker 1: Additional editing by Moses and special thanks to Andrew J.
Speaker 2: Scott and to John Steppick and just to remind you
Speaker 2: that you can follow us on Twitter. I am at
Speaker 2: meren sw and John is at John Underscore stepk