Berlin
For the first time, East and West are on par when it comes to pension levels. In addition, the pension increases significantly. But there’s a catch: inflation.
The Federal Cabinet decides on Wednesday (11 a.m.) a significant increase in pensions. The round 21 million pensioners in Germany can be happy: From the summer they will receive more money. also read: More money: Why the pension manager promises an increase
That was because of the rising wages been expected. In addition, the pension fund is considered stable.
Pension value: Same in east and west
However, the increase is higher than promised by the pension insurance. As the Federal Ministry of Labor announced on Monday that pensions in western Germany will increase by 4.39 percent as of July 1.
In the east, pensions are even increasing 5.86 percent. This means that the current pension value is the same in West and East.
The basis for the pension increase that has now been announced is the data now available from the Federal office of statistics and the German Pension Insurance Association.
Pension: Minister Heil refers to a good labor market
Labor Minister Hubertus Heil (SPD) said, “These increases are possible because of the Labor market in good shape and wages are rising.” The level of security therefore remains stable at over 48 percent. “I want the statutory pension stabilize in the long termso that people can continue to rely on good old-age provision in the future,” emphasized Heil. The statutory pension must remain reliable.
“I am particularly pleased that the east pension adjustment is being achieved a year earlier due to the positive development,” said Heil. Because wages in east recently increased even faster than in the West, the pension adjustment will be completed a year faster than legally required.
In practice, the alignment means that a pension value of EUR 37.60 now applies in the old and in the new federal states. This is the amount that the pension insurance for a pension point pays. Employees are credited with one pension point if they earn exactly as much as the average employee in one year. Finally, the amount of the old-age pension depends on the number of pension points that an employee collects over the course of his working life. As of July 1 of last year, pensions in western Germany had risen by 5.35 percent and in eastern Germany by 6.12 percent.
Pensioners badly hit by inflation
However, the high inflation is causing problems, especially for recipients of small pensions. For the current year, the federal government expects a slightly slower, but still high inflation rate of six percent. In February, however, consumer prices were still up 8.7 percent year-on-year. “Pension adjustment is currently lagging behind inflation, but that’s it just a snapshot“, it said in a statement from the Federal Ministry of Labor.
In the past ten years, the pension value has risen by a total of 26 percent in the West and by as much as 40 percent in the East. Prices, on the other hand, only increased by 20 percent in the same period. “The pension was 1,000 euros pension adjustment gross by EUR 63 in the west and EUR 198 in the east above inflation during this period,” according to the ministry.
“Currently completed collective agreements “We are planning considerable wage increases,” the statement continued. These would then be reflected in the pension adjustment on July 1, 2024. The wage increase relevant to the current pension adjustment is 4.50 percent in the old federal states and 6.78 percent in Germany the new countries.
The President of the German Pension Insurance, Gundula Roßbach, had previously referred to the very good cash position made aware. She spoke of a surplus of 3.4 billion euros last year. “The previous collective agreements also give an idea that senior citizens can hope for a pension supplement in the coming years,” said Roßbach. The pension increases depend on the wage development in the country.
More pensions in Germany: social expert speaks of an “important signal” and warns of stock pensions
The chairwoman of the board of directors of the Social Association Germany, Michaela Engelmeier, welcomes the pension increase. “Especially in these critical times, the robustness of the statutory pension is evident,” she said with our editors. This would mitigate the negative consequences of inflation for 21 million pensioners. “Furthermore, I welcome the alignment of the The interest rate in East and West, which is now a year earlier than expected.”
To claim one funded When it comes to pensions, Engelmeier adds: “Right now, the increase is an important signal for a strong statutory pension, where concern is growing on the financial markets about a possible financial crisis 2.0, triggered by the tumbling banks in Silicon Valley and Credit Suisse.” The Social Association Germany sticks to it: “A reliable pension policy is not possible on the stock markets!” (with dpa)
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