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Traffic light plans for pensions are presented: What we know about pension package II

2024-03-02T17:14:59.273Z

Highlights: Traffic light plans for pensions are presented: What we know about pension package II. As of: March 2, 2024, 6:00 p.m By: Amy Walker CommentsPressSplit In the coming days, the traffic light government will present its plan to reform pensions. This is also urgently necessary. The main aim is to stabilize the pension level in the long term and to put pension financing on a secure footing. The FDP's pension policy spokeswoman told Table.Media that the Pension package II would initiate a “paradigm change in pension policy”



As of: March 2, 2024, 6:00 p.m

By: Amy Walker

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Press

Split

In the coming days, the traffic light government will present its plan to reform pensions.

This is also urgently necessary.

Berlin - The pension package II has been announced for a long time, to be exact since the summer of 2022. After it had to be pushed back several times, it is now really coming: According to several media reports, the package will be presented next week.

The main aim is to stabilize the pension level in the long term and to put pension financing on a secure footing.

The FDP's pension policy spokeswoman told

Table.Media

that the pension package II would initiate a “paradigm change in pension policy”.

Pension package II is intended to stabilize pensions

What is known so far about Pension Package II: It is intended to legally secure the pension level to 48 percent until well into the 2030s and, in order to finance this, so-called “generational capital” is to be introduced.

The latter is often referred to as a stock pension, meaning that the state invests capital on the open market, which then ideally generates a return for the statutory pension insurance.

The pension level essentially describes the average pension that an insured person receives compared to their previous wages.

So: on average, pensioners should receive 48 percent of the average wage.

The pension level has fallen again and again in recent years because financing is becoming increasingly difficult.

The statutory pension in Germany works according to the pay-as-you-go system: the working insured people pay for the pensions of the elderly.

However, due to demographic change, there are fewer and fewer insured people compared to more and more old people.

Labor Minister Hubertus Heil will present a pension package in the coming days.

© Bernd von Jutrczenka/dpa

The Federal Statistical Office has calculated that by 2060 there will only be two insured people per pensioner.

So: Two people pay for the pension for a senior citizen.

This will not be possible without additional financing channels, which is why the traffic light relies on generational capital.

This is intended to delay an increase in pension insurance contributions.

According to the pension insurance calculations, the contribution would have to rise to 22 percent by 2035.

Insured people currently pay 18.6 percent of their gross wages into statutory pension insurance.

Experts doubt the traffic light pension reform

According to experts, the traffic light plans will not be enough.

On the one hand, it is doubtful that the generational capital will generate enough returns to really secure the pension level at 48 as desired by the traffic light.

There is a risk of a sharp jump in contributions - or other ways will have to be found.

The CDU is now also calling for the retirement age to be linked to life expectancy, i.e. to continue to increase gradually.

The retirement age is currently increasing gradually to 67 years.

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Other proposals that have become loud in recent weeks and months: abolishing early retirement (“pension at 63”) and the mother’s pension, both of which economists believe place an unnecessary burden on the pension fund.

Source: merkur

All news articles on 2024-03-02

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