Pensions will rise by 4.57 percent on July 1st

The salaries of around 21 million pensioners in Germany are increasing noticeably: as of July 1st there will be an increase of 4.57 percent. For the first time, pensions are rising equally in the old and new states.

Pensions in Germany will rise by 4.57 percent on July 1st. A pension of 1,000 euros increases by 45.70 euros. Federal Labor Minister Hubertus Heil announced this based on the data on wage developments. “The strong labor market and good wage agreements make this possible,” explained the SPD politician. The pension adjustment is well above the inflation rate.

Pensions are rising equally in the old and new states for the first time. The pension adjustment is above four percent for the third year in a row, emphasized the Ministry of Social Affairs. In the new federal states, the pension value in the east had already reached the value in the west last year due to higher wage increases.

Strong labor market and good wage agreements

Federal Labor Minister Hubertus Heil (SPD) spoke of “good news” for pensioners. 34 years after German unification, the uniform adaptation in West and East is a milestone for the country. “Work is worth the same in East and West when it comes to pensions.” Heil referred to the coalition’s pension plans. With the pension package, the government is permanently stabilizing the statutory pension, while at the same time relieving the burden on future contributors with generational capital.

Pension level of 48 percent by 2025

The wage increase relevant to the pension adjustment is 4.72 percent. It is based on the wage development reported by the Federal Statistical Office according to the national accounts. In addition, the contributory salary development of the insured is taken into account, which is crucial for the income situation of the statutory pension insurance.

The pension level of 48 percent is currently only guaranteed until 2025. The second pension package planned by the federal government envisages extending the guarantee until at least 2039. As a result, the contribution rates for statutory pension insurance are expected to rise much more than previously assumed.