The OBR predicted that health spending will rise from 6.8% of gross domestic product (GDP) in 2016/17 to 9.1% by 2061/62. State pension and social care costs are also predicted to increase.
Without substantial cuts in spending or increases in tax, the gap between government income and expenditure will widen, the OBR warned.
The financial watchdog's ‘fiscal sustainability report’ included 50-year projections for all public spending, revenues and significant financial transactions in order to review the sustainability of the UK’s public finances.
The proportion of the population aged over 65 is expected to rise from 17% in 2012 to roughly 26% in 2061.
The office expects that the government will have to spend more money on age-related items, such as pensions and health care, with a negative effect on public finances.
The OBR commented: ‘From 2016/17 onwards the main drivers of the increase in non-interest spending are health, state pensions, and long-term care costs, due mainly to the ageing population.’
The European Commission produces its own analysis of ageing pressures for member states every three years. The most recent projections estimate that the UK would experience an additional spending pressure equivalent to 3.3% of GDP between 2010 and 2060 This was slightly below the EU average of 3.9% of GDP.