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Expert assessment: SPD plans possible abolition of the income test for basic pensions
According to a report from www.t-online.de, there are possible changes to the income test for the basic pension. Both the SPD and the FDP expressed criticism of the procedure and spoke out against the income test. Pension experts from both parties doubt the effectiveness and accuracy of the income test and emphasize the high administrative costs associated with it. The basic pension, which was introduced at the beginning of 2021, is intended to benefit people who have paid into the pension fund for at least 33 years but earn below average. It is a supplement to the pension, but fewer pensioners than expected benefit from it. According to the report, only...
Expert assessment: SPD plans possible abolition of the income test for basic pensions
According to a report by www.t-online.de, there are possible changes to the income test for the basic pension. Both the SPD and the FDP expressed criticism of the procedure and spoke out against the income test. Pension experts from both parties doubt the effectiveness and accuracy of the income test and emphasize the high administrative costs associated with it.
The basic pension, which was introduced at the beginning of 2021, is intended to benefit people who have paid into the pension fund for at least 33 years but earn below average. It is a supplement to the pension, but fewer pensioners than expected benefit from it. According to the report, only around 1.1 million of the approximately 21 million pensioners receive the basic pension.
The criticism of the income test is based primarily on the fact that many basic pension recipients received reduced salaries after the test. It is also emphasized that a large proportion of the money spent on the basic pension is used for income verification and therefore does not reach the pensioners. The administrative costs and the bureaucratic effort are cited as further points of criticism.
The possible abolition of the income test for the basic pension could have far-reaching effects on the market and the financial sector. Saving administrative costs could free up funds that could be used for other purposes, for example to increase benefits for pensioners. In addition, abolishing the income test would simplify the procedure and reduce bureaucratic effort. In the long term, this could lead to a more efficient and targeted distribution of pension funds.
Overall, the possible abolition of the income test for basic pensions is a significant issue with potentially far-reaching effects on the market and the financial sector. It remains to be seen whether the political parties will agree to change the procedure.
Read the source article at www.t-online.de