A growing wave of discontent is sweeping through the German business community regarding the pension package proposed by the ruling SPD and CDU coalition government. Thirty-two prominent industry associations have collectively voiced their opposition, urging parliament to halt the legislation, according to a report in Bild.
In a sharply worded letter addressed to the parliamentary leaders of the CDU/CSU and SPD, the associations declared the proposed reforms “untenable” projecting an additional burden of nearly €480 billion on the state by 2050. The letter highlights a dramatic escalation of annual costs, leaping from €18.3 billion under current regulations in 2031 to a staggering €27 billion by 2050. Signatories include heavyweight organizations such as the Wholesale and Foreign Trade Association (BGA), Gesamtmetall, the Construction Association (ZDB), the Retail Trade Association (HDE), “Family Businesses” the Engineering Association (VDMA), the Taxpayers Association and the Federation of Medium-Sized Businesses (BVMW).
The associations, representing an estimated 17 million employees, accuse the government of fundamentally flawed pension policy. They argue the legislative draft strains the sustainability of the system, rendering it neither intergenerationally fair nor financially viable. A particularly contentious point raised is the premature curtailment of the future Rentenkommission (Pension Commission), tasked with long-term systemic reform from 2031. The commission’s ability to act will be effectively nullified before it even commences its work, according to the letter.
The business leaders warn of a potential collapse of the German pension system. They foresee a cycle where employees face progressively higher pension contributions or increased taxes to fill the burgeoning deficit. This escalating cost burden, they contend, will accelerate the erosion of German businesses’ competitiveness, potentially triggering a rapid relocation of production and jobs to more affordable foreign locations. The existing contribution-funded pension system, they stress, is at risk of being irrevocably shattered.
Bild reports that the associations are calling for a complete policy reversal. They advocate for the elimination of the “Rente mit 63” (early retirement scheme at 63), a modest increase in the statutory retirement age and steeper deductions for individuals opting for early retirement. The coalition government now faces a significant challenge in navigating this growing backlash and justifying a policy that many believe is unsustainable and detrimental to the German economy.