Economists say two new Treasury papers make it clear there's no easy fix to keep New Zealand's pension affordable.

The papers were produced as part of preparing Treasury's long-term fiscal statement and look at how NZ Super is indexed, and how raising the age could affect how affordable it is for the country.

The papers note that New Zealand's ageing population is expected to add to the cost of NZ Super over the coming decades, at the same time as there will be other cost pressures, such as in healthcare. The researchers said addressing the pressure would require policy choices that would affect government revenue, spending and public debt.

The number of working-age people compared to those over 65 is expected to drop from four-to-one now to two-to-one by the end of the century.

NZ Super already costs more than $20 billion a year.

One of the papers looked at how the pension is indexed. At present, NZ Super is linked to average wages. The paper said that changing that so that it was indexed to price increases, or a mixed indexation, could be a way to reduce the cost.

"These changes not only alleviate the government's tax revenue requirements but also incentivise greater workforce participation and savings, contributing to a stronger economy."

The other looked at the impact of increasing the age of eligibility. But it said the age would need to rise to "very high" levels to keep pension spending at its current level as a proportion of gross domestic product (GDP). It would need to reach 75 by 2100, and 79 if consumption taxes are used to fund increases in health and pension spending.

The researchers calculated that raising the age of eligibility to 70 would reduce gross pension costs by between 1.64 and 1.84 percentage points of GDP by 2065, depending on the assumptions made about workforce participation.

"Net pension costs, which take into consideration tax paid on pensions, would fall between 1.15 and 1.23 percentage points of GDP by the year 2065. This translates into average [gross] cost savings of between 0.33 and 0.37 percentage points of GDP for each additional year that the retirement age is raised. The net-of-tax savings would be 0.23 and 0.25 percentage points of GDP for each year that the age of eligibility is raised."

Simplicity economist Shamubeel Eaqub was part of the review team for Treasury and said the findings were what he would expect.

"If you think about the levers that we need to pull to make superannuation sustainable, indexation and raising the age of eligibility don't do very much ... it creates some benefits, but it's at the margin."

He said a move to the Australian model of some private provision and means-testing of the pension would be the only thing that sufficiently made a difference.

"I think that's what these papers do really well. They really identify that it's not just the cost of the pension you need to think about. It's also those other things that are happening in terms of older people retiring in renting, older people needing more hospital care, those kinds of things. So those costs are still building. It's not like you can look at superannuation isolation.

"I think it's essentially saying there are no easy choices here. There's a big trade-off to be had."

The papers noted that the impact of changes on different parts of society would need to be considered.

People who were more immediately affected would have less time to adapt and could miss out on support, while future generations would benefit from lower tax burdens and improved economic outcomes.

"Within generations, higher-income individuals are less affected by pension reductions and gain more from reduced taxes and a stronger economy, amplifying disparities between low- and high-income households."

They said it would be important to give sufficient warning of any changes.

"Pre-announcing policy changes and spreading changes out over time reduces the burden felt by people from these changes because they have more time to adapt their lifetime behaviour, including consumption, saving, and labour supply."

ANZ senior economist Miles Workman said the papers added to "one of the most significant fiscal challenges facing New Zealand".

"A key message from both is that there is no single policy lever that can fully address the fiscal pressures associated with an ageing population, and every option involves trade-offs between generations, income groups and taxpayers.

"Importantly, maintaining the status quo isn't cost-free either. Without policy changes, the growing cost of superannuation and health spending would ultimately need to be funded through higher taxes, lower spending elsewhere, higher debt, or some combination of all three. The challenge for policymakers is deciding how those costs are shared across current and future generations."