(de-news.net) – In order to safeguard the statutory pension level, the Federal Government has enacted a comprehensive pension reform package. A particularly contentious element of the draft legislation is the proposed expansion of the so-called “mother’s pension.” The provisions outlined in the bill seek to maintain the pension level at 48 percent of the prevailing average wage through the year 2031. Absent such measures, current projections anticipate a decline to 47.0 percent by 2031 and further to 45.0 percent by 2040. The total financial burden associated with the reform is to be borne exclusively by the federal budget, with anticipated annual expenditures reaching double-digit billions beginning in 2027.
Political and economic personalities had voiced divergent views on Germany’s pension package ahead of Wednesday’s cabinet vote. Mathias Middelberg, deputy with the CDU-CSU in the Bundestag, believed that maintaining pension levels at 48% until 2031 was crucial for ensuring financial stability. He called for significant structural changes reminiscent of previous programs, but cautioned that the pension fund’s dependence on state subsidies rendered its future unsustainable. Middelberg also viewed Labour Minister Bärbel Bas’s (SPD) idea of expanding pension contributions to include civil servants and the self-employed as worth considering, though he pointed out this could increase long-term liabilities.
The Greens firmly backed the reform, emphasizing its value for intergenerational justice and societal trust. Andreas Audretsch, parliamentary delegate of the party, emphasized the necessity for a secure pension and contended that opposing the measures could increase the risk of old-age poverty, particularly among women and East Germans. He also proposed changes to private retirement savings, emphasizing the need to ensure the system’s financial viability without causing contributions to skyrocket.
Economist Veronika Grimm, on the other hand, strongly criticized the government’s draft. She asserted that the measures might have made financial strain worse by ignoring how serious the budget crisis was. Grimm claimed that maintaining current pension levels while increasing maternity benefits would put an excessive strain on the federal budget and raise labor expenses. She demanded significant reforms, such as tying pensions to inflation, adjusting the retirement age to life expectancy, and doing away with expensive benefits like early retirement and the present widow’s pension model.
