The average Australian will live to their mid-to-late 80s within a few generations, but the nation will have to get its health policies right to make the most of the added years.
Treasury’s latest Intergenerational Report, to be published in full on Monday, will project the impact of government policies 40 years into the future.
An extract released on Sunday showed life expectancy at birth was forecast to reach almost 90 for women by 2065/66, up from about 86 years at present.
Life expectancy for men was predicted to rise to 86 years in the next four decades, up from 82 years.
The figures would retain Australia’s record for one of the highest life expectancies in the world.
Australian Medical Association chief Danielle McMullen welcomed the rise as a sign of policy success, but warned of the challenge to ensure the extra years were worth living.
‘Over the last few generations we’re living longer, but we’re also living more years in ill health with chronic disease or mental illness,’ she told ABC News on Sunday.
‘That’s certainly something as doctors we would want to turn around and make sure people are staying healthy as well as living longer lives.’
Jim Chalmers (pictured) said the report was ‘confronting’ in some cases but not pessimistic
More focus should be put on preventative health, Dr McMullen said, noting regular interactions with doctors earlier in life could reduce chronic ailments later on.
Treasurer Jim Chalmers said the report laid out the case for further investments in Medicare and the Pharmaceutical Benefits Scheme, and the rollout of urgent care clinics.
But a growing and aging population would also be at the centre of long-term budget pressures, Chalmers told News24’s Sunday Agenda program.
‘There are elements of the intergenerational report which are confronting, but it’s not a pessimistic report … because Australians are genuinely better placed and better prepared for all of this accelerating change that we are seeing,’ he said.
Australia’s population is expected to be slightly lower by the mid-2060s than forecast in the 2023 Intergenerational Report.
Population growth was expected to slow to 0.9 per cent per year over the next four decades, down from 1.4 per cent annually in the previous 40 years, according to Treasury forecasts.
The nation’s population was predicted to reach 39.3 million by 2065/66, 1.8 million lower than the 2023 forecast.
Much of the slowdown in population growth was tied to lower fertility rates as women continued to have fewer children.
Australia’s population is set to be lower than first forecast in the 2023 Intergenerational Report. Pictured, commuters at Parramatta train station
‘Almost half the decline in fertility rates is actually because fewer people are having three or more kids and what that reflects is mums having fewer kids later in life,’ Chalmers said.
‘Our job is to make it a little bit easier for people to make that choice if they want to,’ he said, noting Labor’s policies to subsidise child care, increase paid parental leave and lift mandatory superannuation contributions.
Opposition Leader Angus Taylor said young families should be able to have confidence they could afford to have children, but the Coalition had no plans to revive the Howard and Costello-era ‘baby bonus’ policy.
Future government debt is expected to be slashed by half a trillion dollars compared to forecasts in the 2023 report, but much of the economic progress relies on emerging technologies such as artificial intelligence.
‘Overwhelmingly, the fiscal story is a little bit better; but still, lots, lots more work to do to manage some of these pressures and risks,’ Chalmers said.
Previous Treasury advice suggested AI could provide significant productivity gains across the public and private sectors if the nation kept pace with the global shift towards the technology.
Mr Taylor said Labor would ‘cook the books’ and rely on rosy productivity assumptions to deliver better-than-expected budget forecasts.
