The German Left party is calling for a radical overhaul of the pension system for self-employed professionals, spurred by recent financial missteps within several occupational pension schemes. Sarah Vollath, the Left’s spokesperson for pensions and retirement security, argues that the “special path” of these schemes, which operate as a pillar of Germany’s initial retirement security, demands critical re-evaluation.
These pension schemes, often utilized by doctors, lawyers, tax advisors and architects as a substitute for the state pension, manage an estimated €300 billion in assets. Membership is compulsory and the system has long been criticized for its lack of transparency and accountability.
The recent crisis at the Berlin Chamber of Dentists’ pension scheme (VZB), where investment losses have reached a “high three-digit million” sum, has intensified calls for reform. Thomas Schieritz, chairman of the VZB’s administrative board, confirmed the substantial losses, impacting the retirement prospects of over 10,000 dentists.
Vollath’s proposal centers on a universal employee insurance program, mandatory for all and providing protection for all. Currently, many professionals opt out of the state pension system to leverage the advantages of these schemes, effectively forfeiting a guaranteed social safety net. Vollath argues that a secure retirement should not be contingent on the success of investments in corporate shares and start-ups.
The Left’s demands extend beyond a broad systemic shift. They include the introduction of nationwide minimum standards, stringent oversight conducted by independent state bodies and curbs on risky investments. Mandatory stress tests, full portfolio transparency and personal liability for board members are also advocated, alongside the clawback of bonuses during periods of loss, enhanced whistleblower protection and strengthened member rights. The party contends that the current self-governance structure lacks the necessary checks and balances, leaving pensioners vulnerable to mismanagement and speculative losses. The situation highlights a fundamental political debate about the role of the state in ensuring social security and the potential risks associated with allowing professional bodies to manage substantial retirement funds with limited external oversight.