The Republic’s rapidly ageing population is likely to cost the exchequer an additional €850 million a year from 2021 onwards, the Irish Fiscal Advisory Council (Ifac) has warned. Ireland’s fertility rate is now well below replacement level.

In the report it estimates that the additional cost of providing pensions to new pensioners – public sector and social welfare recipients – will be €370 million a year between 2021 and 2025. while the additional cost of providing healthcare to an ageing population will be €484 million a year.

That puts the costs of providing for an ageing population at €854 million annually.

And while the projections are only out to 2025, these types of age-related costs will continue at the same level or higher after 2025, Ifac’s chief economist Eddie Casey warned.