Pension insurance boss expects rising pensions and stable contributions

Pension insurance boss expects rising pensions and stable contributions

Gundula Rossbach

The President of the German Pension Insurance Association gives the more than 21 million pensioners hope for a “proper premium”.

(Photo: DRV Bund photo archive/Nuremberg)

Berlin Federal Minister of Labor Hubertus Heil and the pension insurance were pleased with the pension finances, which exceeded expectations with a high surplus in 2022. A strong labor market leads to a stable pension, said the SPDpoliticians on Sunday from the Reuters news agency. “This is also reflected in the good development of the sustainability reserve of the statutory pension insurance, which has increased to 42.7 billion euros according to the preliminary results.” The reserves of the pension fund at the end of 2022 were higher than ever.

The President of the German Pension Insurance Association, Gundula Roßbach, told the “Bild am Sonntag”: “Income is increasing, last year there was even a surplus of 3.4 billion euros – we did not expect that.”

For the current year, Roßbach assumes that income and expenditure will be balanced: “For the year as a whole, we can hope for a black zero.” in later years will melt very quickly to 7.4 billion euros in 2027. The contribution rate for pension insurance of 18.6 percent of gross wages would remain stable, but would then have to increase in 2027.

This assessment has apparently remained the same, even after new calculations. “Up to 2026, the contributions to the pension insurance will remain stable according to the projections,” said Roßbach. “After that, the contributions could rise – that also depends on what the pension package will look like, which politicians want to launch this year.”

Roßbach was alluding to Heil’s plan to secure the pension level at at least 48 percent of an average wage. There is no draft law on this yet. This is also due to the fact that Finance Minister Christian Lindner (FDP) wants to specify details of the share pension he is pushing for in the pension package. From the mid-2030s, this is intended to relieve the pension insurance system through proceeds on the capital markets.

Pension insurance boss Roßbach expects “proper” pension increase

Roßbach also justified the good financial situation with the fact that “despite the mood of crisis, things are going well on the job market, and companies are even urgently looking for employees”. Roßbach gave the more than 21 million pensioners hope for a “proper premium”.

With the pension increase on July 1, 2022, inflation was not compensated for by the pension adjustment, Roßbach admitted. “But if you look at the last few years as a whole, then there was a good increase in pensions that was higher than the price increases.”

According to initial calculations in the autumn of last year, pension increases could also lag behind general price increases this year. In the pension insurance report, the federal government assumed an increase of a good 3.5 percent in the west and around 4.2 percent in the east.

The specific amount of the pension adjustment should be known shortly, since the Federal Statistical Office regularly sends the necessary data on wage developments to the Ministry of Labor in March.

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