12 Oct 2010

Warning shot over NZ's credit rating

7:17 pm on 12 October 2010

An international credit rating agency is warning New Zealand's ageing population and declining workforce could put the country's long term credit rating at risk.

Standard and Poors says the number of people over the age of 65 will almost double over the next 40 years, while the working age population will shrink by 7%.

It says higher spending on age-related health, pensions and aged care, could result in the government's net debt swelling to more than 358% of GDP by 2050.

A rating analyst at Standard and Poors Kyran Curry says unless measures are taken now, New Zealand's credit rating could be reduced to junk status.