ABSTRACT
In 1997, the state pension problem facing the new UK government was not one of funding but of adequacy.
A series of reforms by the administration of 1979-97 had seen a fall in projected spending on state pensions as a proportion of GDP. Rather than the ‘demographic timebomb’ of popular perception leading to a funding crisis, the UK was one of few developed countries to face no serious future funding problems in its state pensions. In fact, as a proportion of GDP, state spending on transfers to the elderly was projected to fall by one-third over the next 50 years.
