The recent passage of the German government’s pension package has been met with cautious optimism from Verena Bentele, President of the social welfare association VdK. While acknowledging the move to cap the pension contribution rate at 48 percent as a necessary measure to safeguard purchasing power for current retirees over the next six years, Bentele has warned that the legislation represents only a partial solution.
“This is a welcome step and a vital confidence booster for those relying on the state pension system” Bentele stated, “but it’s imperative that we don’t consider this the endpoint of our efforts”. The inclusion of adjustments to childcare periods aligning them with the ‘mothers’ pension’ has also been welcomed, but the VdK maintains that a broader systemic overhaul is now crucial.
The association is urgently calling for the planned Pension Commission to prioritize a fundamental redistribution of the burden, advocating for the incorporation of civil servants and self-employed individuals into the statutory pension scheme. Furthermore, Bentele highlighted the need to unlock latent potential within the workforce, specifically targeting female participation to bolster the long-term sustainability of the system.
However, the most pressing concern remains the ongoing battle against poverty in old age. The current package, according to Bentele, falls short of delivering tangible relief for those increasingly reliant on basic security provisions. The VdK is pushing for the introduction of allowances on statutory pension payments for individuals requiring basic income support – a measure which would significantly improve the impact of childcare period adjustments for women most at risk of poverty.
“The inequalities in treatment between private, occupational and statutory pension schemes are simply inexplicable” Bentele argued, advocating for a leveling of the playing field with allowances mirroring those already in place for occupational and private pensions, as well as the existing basic pension. This imbalance, the VdK insists, actively undermines the effectiveness of the state pension and perpetuates a two-tiered system of old-age security.