Pensions should rise faster than inflation
According to Hubertus Heil, the contribution rate will remain stable
Source: dpa/Hannes P Albert
The Labor Minister predicts a significant increase in pensions. According to initial estimates, they would rise faster than the inflation rate on July 1st. At the same time, Hubertus Heil (SPD) does not expect any increase in pension contributions for the time being.
bAccording to his own statements, Federal Labor Minister Hubertus Heil (SPD) believes that an increase in pensions above the inflation rate is likely this year. Initial estimates made the federal government “confident that pensions will rise faster than inflation again on July 1st,” Heil told the newspapers of the Funke media group.
The pension increase last year was “not small”, but remained below the inflation rate. “Fortunately, inflation is now falling significantly and there have been decent wage agreements,” said Heil.
Last year, pensions rose by 5.86 percent in the east and by 4.39 percent in the west. Consumer prices in Germany increased by an average of 5.9 percent in 2023 compared to 2022. In January 2024, the inflation rate was 2.9 percent.
Employment in Germany “at record levels”
According to Heil, he does not initially expect any increase in pension contributions. Employment in Germany is “at a record level,” said Heil. The contribution rate has therefore been stable at 18.6 percent since 2018 and will “remain stable for even longer”.
The pension reform planned by the federal government should prevent significant increases in the future. Federal Finance Minister Christian Lindner (FDP) and he are “very far along” with the reform and will present the new pension package “in a few weeks,” said.
It is about “securing the pension level in the long term”. Without reform, pensions would “fall significantly” in the coming years, said Heil. The government will prevent this – without further raising the statutory retirement age.