Minister Heil: "Do not disconnect pensioners from wage development"

Created: 04/12/2022, 05:15

The Federal Cabinet sets the course for the pension adjustment and a reform of the disability pension.

© Marijan Murat / dpa

Pensioners facing a record plus - how are pensions developing despite the corona pandemic?

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Berlin – Despite the corona pandemic, the increase in pensions will reach a record this summer.

"These are the largest pension increases in about 30 years," said Federal Labor Minister Hubertus Heil (SPD) of the German Press Agency in Berlin.

This Wednesday, the Federal Cabinet will set the course for the design of the pension adjustment and for a reform of the disability pension.

Heil wants to present a pension package I to the ministerial round.

This would mean significant improvements in the reduction in earning capacity and the catch-up factor would be reinstated, as the SPD politician announced.

The catch-up factor should strengthen the stability of the pension, said Heil.

2021 was a zero round for the west

"It is important to me that pensioners are not decoupled from general wage and salary developments in the future either," emphasized the minister.

"At the beginning of the corona pandemic, we had a major slump in the labor market in 2020.

That would have led to a pension cut.” The existing pension guarantee prevented this last year.

In fact, in 2021 there was a freeze in western Germany and a slight increase in eastern Germany.

It was already known that the government wants to compensate for the commitment to the pension guarantee by reinstating the catch-up factor - without this step, the pension increase this summer would be even higher.

Employers had criticized that pensions should nevertheless rise too much and that the government was too hesitant about the catch-up factor.

The employers' association BDA complained that it was incomprehensible when pensions were to rise much faster than wages.

The trade unions, on the other hand, criticized the dampening of pensions due to the sustainability factor, as prices threatened to rise further.

At the end of November, the Federal Minister of Labor had publicly assumed an increase of only 4.4 percent in July.

“Good news for pensioners”

Heil now referred to the good revenue development of the pension fund.

“Last year the labor market and wages developed well, also due to short-time work.

We are replicating this good development with the pension increase.” Thanks to the good development, substantial pension increases of a good 5.3 percent in western Germany and 6.1 percent in eastern Germany are possible, emphasized Heil.

"This is good news for pensioners given the rising prices."

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As a result of the increase, a monthly pension of 1,000 euros, which is only based on western contributions, increases by a good 53 euros on July 1, and an equally high pension with eastern contributions increases by 61 euros.

With the improved disability pension, the government is supporting people who can no longer work or can only work part of the time due to illness, Heil said.

"This is about 3 million people who will benefit from surcharges." The improved services should be available from July 1, 2024.

"We spend 2.6 billion euros a year on this and provide people with better security." It's a question of decency and fairness.

dpa