(de-news.net) – Chancellor Friedrich Merz (CDU) has indicated an intention to fundamentally recalibrate Germany’s long-standing old-age security framework by announcing plans to launch a comprehensive reform process later this year. In outlining this initiative, he emphasized that the statutory pension system would continue to exist but would no longer function as the dominant pillar of retirement provision. Instead, it would be repositioned within a broader, more diversified overall structure. Speaking at the annual reception of the German Stock Exchange, Merz framed this approach as a structural modernization, aimed at adjusting the relative weighting of the three traditional pillars of pension provision. Central to this shift, he argued, would be a substantially expanded role for capital-funded private retirement savings and occupational pension schemes, which he portrayed as essential to ensuring long-term sustainability and resilience. To provide an analytical foundation for these changes, a pension commission appointed by the federal government—bringing together members of the governing parties and academic specialists in economics and social policy—is expected to present reform proposals by midyear.
Coalition prepares phased social reforms
Alongside these announcements, Thorsten Frei (CDU), head of the Federal Chancellery, outlined a far-reaching social-policy agenda for the coming year while simultaneously managing expectations regarding its immediate scope and speed. He conveyed that the governing coalition intended to deliver the first major social reforms by the end of the year, with pension reform explicitly identified as the foremost priority within this broader agenda. Other reform projects, he indicated, would follow as rapidly as feasible over the remainder of the legislative period. At the same time, Frei cautioned against assuming swift completion across all areas, noting that it would not be realistic to finalize every planned measure by December. He explained that implementation would likely proceed in stages, reflecting the fact that some recommendations emerging from expert commissions could be enacted relatively quickly, whereas others would require more extensive preparation and coordination.
Frei also addressed fiscal policy considerations by rejecting calls for a large-scale tax overhaul. In his assessment, the existing coalition agreement already provided sufficient latitude to respond to evolving economic and social conditions without the need to reopen negotiations. By contrast, he expressed skepticism toward proposals advanced by the CDU’s business-oriented wing to abolish what is described as “lifestyle part-time” employment. Such initiatives, he argued, would conflict with the party’s underlying principles, insofar as they implied a willingness to prescribe how individuals should structure their private and professional lives rather than preserving personal autonomy within the labor market.
