Fiscal Impact of Demographic Change: The Case of the Czech Republic in European Context

Vugar Mammadov

Bakalářská práce

Anotace:

Europe's population is ageing rapidly, placing increasing pressure on public budgets across the continent. This thesis looks at how demo-graphic change affects public finances in the Czech Republic, focusing on three spending areas where ageing has the most direct impact: pen-sions, healthcare, and long-term care and discusses potential policy responses to ensure long-term fiscal stability. The findings show that Czech pension spending is currently below the EU average but is set to rise sharply as the large 1970s and 1980s birth cohorts retire. Healthcare spending is projected to grow more slowly, though structural weaknesses may worsen outcomes. Long-term care is the fastest-growing category and is currently underfunded, with heavy reliance on informal care that will become harder to sus-tain. The thesis then turns to reform. For pensions, it argues for auto-matic retirement age adjustment linked to life expectancy, alongside benefit formula and indexation reforms. For healthcare, it prioritises strengthening primary care, prevention, and workforce capacity over spending increases alone. For long-term care, it calls for establishing it as a distinct policy area with its own governance, redesigning the care allowance, reorienting services toward home-based care, and unifying the fragmented legislative structure. Throughout, the thesis draws on European comparators to identify lessons relevant to the Czech con-text.

Abstract:

Europe's population is ageing rapidly, placing increasing pressure on public budgets across the continent. This thesis looks at how demo-graphic change affects public finances in the Czech Republic, focusing on three spending areas where ageing has the most direct impact: pen-sions, healthcare, and long-term care and discusses potential policy responses to ensure long-term fiscal stability. The findings show that Czech pension spending is currently below the EU average but is set to rise sharply as the large 1970s and 1980s birth cohorts retire. Healthcare spending is projected to grow more slowly, though structural weaknesses may worsen outcomes. Long-term care is the fastest-growing category and is currently underfunded, with heavy reliance on informal care that will become harder to sus-tain. The thesis then turns to reform. For pensions, it argues for auto-matic retirement age adjustment linked to life expectancy, alongside benefit formula and indexation reforms. For healthcare, it prioritises strengthening primary care, prevention, and workforce capacity over spending increases alone. For long-term care, it calls for establishing it as a distinct policy area with its own governance, redesigning the care allowance, reorienting services toward home-based care, and unifying the fragmented legislative structure. Throughout, the thesis draws on European comparators to identify lessons relevant to the Czech con-text.

Keywords

Population ageing, Fiscal Impact, Fiscal Pressure, Public Expenditure, Pension Expenditure, Healthcare Expenditure, Long-term Care Expenditure

Jazyk práce: angličtina

Datum vytvoření / odevzdání či podání práce: 5. 5. 2026

Obhajoba závěrečné práce

• Obhajoba proběhla 9. 6. 2026
• Vedoucí: Ing. Eduard Bakoš, Ph.D.
• Oponent: Dr. Jonathan Stäbler

Masarykova univerzita

Ekonomicko-správní fakulta

Bakalářský studijní program / obor:
Economics and Public Policy / Economics and Public Policy