(de-news.net) – To foster continued employment beyond the statutory retirement age, the German federal government has endorsed the introduction of the “Active Pension.” Scheduled for implementation on 1 January of the coming year, the measure will grant eligible employees a monthly tax-exempt allowance of 2,000 euros, as confirmed by Chancellor Friedrich Merz.
The Federal Ministry of Finance, under the leadership of SPD Chairman Lars Klingbeil, is preparing the legislative framework. The policy will apply exclusively to individuals who have reached the legal retirement threshold, explicitly excluding early retirees and self-employed persons.
The initiative has elicited critical responses from various stakeholders. Steffen Kampeter, Chief Executive of the Confederation of German Employers’ Associations (BDA), described the proposal as conceptually inconsistent, arguing that it simultaneously incentivizes both prolonged employment and early retirement. Gundula Roßbach, President of the German Pension Insurance Federation, emphasized structural impediments such as health limitations, adverse working conditions, and employer reluctance, cautioning that the reform may entail substantial fiscal burdens without resolving underlying systemic issues.
Amid broader social policy reforms, Volker Geyer, Chair of the Civil Service Federation (dbb), warned against potential reductions in pension and retirement entitlements. He advocated for binding state reserves to ensure sustainable pension financing and reaffirmed the resilience of the civil service pension system. Geyer expressed confidence in the coalition’s capacity to implement its reform agenda in a coherent and unified manner.
CDU Secretary General Carsten Linnemann previously defended the proposed Active Pension, asserting that it constitutes a strategic response to the skilled labor shortage and provides meaningful incentives for older professionals to remain engaged. He further suggested that the reform could catalyze a cultural shift toward valuing continued professional contribution.
