More money for fathers and mothers: the Bundestag decides on an important pension plan

policy

Thursday November 8, 2018

Parliament approved the grand coalition pension package. It will come into force next year. For pension insurance, the reform entails additional costs per billion.

The Bundestag has approved the multi-billion dollar Big Coalition pension package. Mothers and fathers born before 1992 will receive a little more money from the pension next year. It also guarantees that by 2025, the contribution rate will be capped at 20% and the level of pensions maintained at 48% of the average wage. If they receive a new pension from 2019, they will receive a lot more.

In the final discussion on the package, Andrea Nahles, leader of the SPD party and the parliamentary group, stressed the importance of compulsory pension insurance as a central pillar of pension provision. She is still doing well today, while private supply has stumbled due to the financial crisis. The younger generation must have security on their pension, said Nahles. Anyone who has worked all his life "earns" an adequate pension.

For the financing of the package, among other things, contribution reductions are canceled. Under the legislation in force, contributors should be exempt from 6 billion euros in 2019, given the high reserves. For pension insurance, the package means additional expenses of about 32 billion euros.

Taxpayers' alliances are hotly criticized. "With the pension measures, taxpayers and contributors will have to bear additional costs of 50 billion euros by 2025 alone," said Reiner Holznagel, president of the "Rheinische Post". Holznagel mainly criticized the tax subsidies granted to the pension fund, which represent a major challenge for the federal budget. "It will not make it easy to maintain the black zero in the years to come," he said. "I think the pension package is fake, because it's been published in a hurry and that the taxation of pensions is completely hiding."

During the vote in the Bundestag, 362 deputies out of 644 voted for the package. 222 voted against, 60 abstained. The pension package is expected to come into effect at the end of the year.

Source: n-tv.de