(de-news.net) – Changes to Germany’s pension law that permit deduction-free retirement following 45 years of contributions are being negotiated by the CDU/CSU and SPD. Reducing credited child-rearing time, extending the qualifying period, and restricting exceptions to employees in extremely demanding jobs are some of the proposals. Constanze Janda, co-chair of the pension commission, is in favor of abolition, citing financial sustainability, but would also support a transition period and targeted protection for workers who are unable to continue until statutory retirement age.
The parliamentary factions of the CDU/CSU and SPD are negotiating a compromise amid a dispute over plans to eliminate the pension provision that allows workers to retire without deductions after 45 years of contributions. The debate centers on how broadly the provision should continue to apply and whether exceptions should be preserved for workers facing particularly demanding circumstances. According to media reports citing coalition sources, one proposal would extend the qualifying period by as many as two years, meaning workers could become eligible for deduction-free retirement after 46 or 47 years of contributions. Another option under consideration would reduce the amount of child-rearing time that can be credited toward eligibility; under the current rules, up to 10 years can be recognized per child. Media reports have also indicated that the benefit could eventually be restricted to occupational groups involving particularly strenuous physical labor, including workers such as roofers.
Alexander Hoffmann, leader of the CSU state group, reportedly stressed that the coalition agreement was intended to end the provision as a general rule while retaining exceptions for cases considered especially difficult. The distinction between a broad entitlement and narrowly defined exemptions has consequently become a central issue in the negotiations.
Sepp Müller, deputy leader of the CDU/CSU parliamentary group, likewise reiterated that the pension provision based on 45 years of contributions should be eliminated, arguing that the change was necessary to preserve the pension system’s long-term stability. While acknowledging that concerns within the SPD were understandable, he maintained that exemptions should be directed toward workers whose occupations involve sustained and physically demanding labor rather than toward employees who take advantage of early-retirement arrangements despite having less physically demanding jobs. Under the approach described by Müller, a hardship clause would provide a targeted exception while the general entitlement after 45 years of contributions would be discontinued.
Janda urges targeted pension pathway for workers facing hardship
The pension commission’s co-chair, Constanze Janda, has characterized the proposed abolition as a central component of the commission’s recommendations rather than as an optional or secondary measure. She argued that the provision costs billions of euros each year and that those resources are needed for other purposes within the pension system. From her perspective, the arrangement cannot be financed sustainably over the long term, making its eventual abolition unavoidable. Delaying the decision, she argued, would not resolve the underlying financing issue but instead shift more of the financial burden onto younger generations.
Janda has also criticized the political debate for allowing concerns about perceived injustice to take precedence over broader questions of pension financing. In her assessment, the discussion has not sufficiently examined the longer-term consequences of maintaining the existing arrangement. She argued that the current provision does not adequately serve the workers for whom it was originally intended because employees in physically demanding occupations may effectively subsidize earlier retirement for relatively well-off office workers. That distributional concern is particularly relevant, she maintained, because the costs of unrestricted early retirement would have to be considered alongside plans for a funded pension pillar. If the latter were introduced, covering the existing multibillion-euro costs of the early-retirement provision would become more difficult within the broader financing framework.
On the question of potential exemptions, Janda said the commission had instead envisioned a pension pathway specifically designed for people who genuinely could not continue working until the statutory retirement age because of health-related limitations. Such an approach, she argued, would more directly target workers in physically demanding occupations while distinguishing them from people who are able to continue working but choose to retire earlier under the existing rules. The commission had also envisaged transitional arrangements following abolition of the current provision. In that context, Janda indicated that a transition period could be considered a feasible way of managing the change while moving toward the proposed new framework.
