The approximately 21 million pensioners in the country will receive a substantial pension increase for the second year in a row. The federal cabinet decided on Wednesday in Berlin that the Retirement benefits as of July 1 increased by 4.39 percent in the West and by 5.86 percent in the East become. The numbers were already known. The corresponding regulation is now on its way.
It still has to be approved by the Federal Council, which is a formality. The Bundestag does not have to agree. The plans also provide for an adjustment of the pension value in the east to that in the west – a year earlier than planned.
21
millions There are pensioners in Germany.
A pensioner in the West with a pension of 1500 euros gets through the Increase from July 1st about 66 euros more per month, in the East about 88 euros more. The fact that pensions in the east are rising more than in the west is due to the so-called adjustment staircase: by 2024, the pension value in the east should be gradually adjusted to that in the west, and this will already be achieved this year. The increase in the minimum wage to 12 euros, from which many people in the new federal states benefited, also contributed to this, said Federal Minister of Social Affairs Hubertus Heil (SPD).
Background: The pensions are based on the wage development in the country. They are usually raised on July 1 of each year. If wages fall, a so-called pension guarantee prevents retirement benefits from falling as well. In the worst case, there will be zero rounds, like two years ago in the wake of Corona or in 2010 after the financial crisis.
From 2010 to 2022, standard pensions rose by over 32 percent in the west and by over 47 percent in the east.
Gundula RossbachPresident of the German Pension Insurance
Last year, pensions in the west rose by 5.35 percent and in the east by 6.12 percent, the fastest in almost 40 and 30 years, respectively. The increase in the current year is also one of the highest in recent decades.
Nevertheless, there is also criticism, for example from the left and from the German Trade Union Confederation (DGB), which referred to the high inflation. Unlike employees, pensioners do not receive any tax-free one-off payments, said DGB board member Anja Piel. She asked for a special payment. The left-wing parliamentary group’s east representative in the Bundestag, Sören Pellmann, welcomed the east-west harmonization of pensions. With a view to inflation, however, he called for a pension increase of at least ten percent.
The Federal Ministry of Social Affairs confirmed that the increase is currently lagging behind inflation. But that is just a snapshot. The president of the German pension insurance, Gundula Roßbach, made a similar statement. In retrospect, there has been a significant increase in pensions since 2010. “So the standard pensions from 2010 to 2022 in the west by more than 32 percent and in the east by more than 47 percent.” The increase was well above the development of inflation in this period, said Roßbach.
According to the Ministry of Social Affairs, prices have risen by around 20 percent over the past ten years. The ministry also referred to the current “considerable wage increases” due to new collective agreements, which would then be reflected in the pension increase next year. (dpa)
