Pension debate: Greens oppose capital stock for pensions

Pension debate: Greens oppose capital stock for pensions

pension debate
Greens brace themselves against capital stock for the pension

Criticism of the planned capital stock for the pension also comes from the Green politician Frank Bsirske.  Photo: Fabian Sommer/dpa

Criticism of the planned capital stock for the pension also comes from the Green politician Frank Bsirske. photo

© Fabian Sommer/dpa

The coalition wants to break new ground with “generational capital”: equity investments are intended to help secure the statutory pension. Now there is resistance at the traffic light.

The Greens in the Bundestag are opposed to long-term protection of pensions through a rapidly growing capital stock.

“Our pension system cannot be made fit for the coming decades through stock speculation,” said the Greens’ social expert in the Bundestag, Frank Bsirske, of the German Press Agency in Berlin.

With the share reserve, the traffic light coalition wants to go into partial capital cover in view of the retirement of baby boomers. This should serve to stabilize the pension level and contribution rate in the long term.

Bsirske made it clear: “The Greens stand by the coalition agreement to allocate a capital stock of 10 billion euros to the pension insurance system. We are opposed to an increase.”

Lindner’s plans for “generational capital”

Federal Finance Minister Christian Lindner (FDP) presented the plans for “generational capital” in mid-January. “We need a capital stock in the three-digit billion range in the pillar of statutory pension insurance,” Lindner told the “Börsen-Zeitung”. The ten billion are “just the beginning”. Minister of Labor Hubertus Heil (SPD) had backed the creation of “generational capital” and called for a safe and long-term investment of the money.

Long-time Verdi boss Bsirske said: “In order to avoid an increase in the pension insurance contribution by 1 percent in the long term with the income from investments, you would need a capital stock of 350 to 570 billion euros, depending on the amount of the return.” The risk remains high. “We know it’s totally unsafe to speculate in the stock market.”

Bsirske warned against diverting pension insurance contributions to the capital stock. “That would be at the expense of millions of pensioners if the funds from the pension insurance were used for this.” Contribution funds may not be used for share purchases.

Bsirske fears “a call for a quantum leap”

“In view of the capital required, a call for a quantum leap for the capital stock is to be feared in the near future,” said Bsirske. “It’s a matter of time before the demand is raised that we have to be big here instead of making a mess.” This path was taken in Sweden years ago. “But that doesn’t mean that this is the right path for Germany,” he said.

The government wants to pave the way for stock pensions as part of a pension package aimed at securing pension levels. The pension level shows the financial security power of pensions in relation to wages. Bsirske demanded: “We have to secure the pension level at least at the current level and strengthen the pay-as-you-go system.”

As of today, the pension contribution rate will remain below 20 percent until the end of the 1920s, according to Bsirske. Increasing contributions would also be stabilized by federal grants. “I find the fantasies of lowering contributions significantly through speculation on the stock market extremely problematic,” said Bsirske. “We will not go down this path.” The Greens politician also said: “There are other ways to set the long-term course for the statutory pension – keyword citizens’ insurance, keyword higher contribution assessment ceiling, keyword employer-financed minimum pension contribution.” These are discussions “that are coming to us for the coming legislative period”. Bsirske demanded that a drop in the pension level and a slide of more pensioners into basic security should not be allowed.

According to the latest figures from the Federal Statistical Office, the number of recipients of basic security in old age has risen by a good 68,000 within a year to 647,515 last September. In 2015 it was still 527,353.


Source link