Germany's ageing population pushes social spending to record high, Ifo says

BERLIN, Aug 24 (Reuters) - Combined spending related to old age and illness accounted for around 70% of total social spending in Germany last year, pushing the social budget to a new record high, according to an analysis by the Ifo institute published on Monday.

• Spending related to old age and illness accounted was responsible for over 80% of the real increase in spending since 1992, the analysis found

• The key structural cost driver behind this trend is demographic change, which is exacerbating the shift in the welfare state burden between generations

• “The social budget is growing faster than GDP, which is why the weak economy is also contributing to the increase in the social budget share,” said Ifo researcher Emilie Hoeslinger

• According to the analysis, social spending rose by 11.5%, or €104 billion ($121.33 billion), between 2019 and 2025, adjusted for price effects

• During this period, the social budget share reached a new record high, rising from 29.6% to 32%

• The main cost drivers are the additional spending for the insured elderly population on illness and care, as well as higher federal pension payments

($1 = 0.8572 euros)

(Reporting by Maria Martinez, Editing by Friederike Heine)