Federal government plans pension reform: self-employed people should be included!

Federal government plans pension reform: self-employed people should be included!

The debate about reforming pension insurance in Germany is gaining momentum. The German Pension Insurance is currently in favor of including self-employed people in the statutory pension fund. President Gundula Roßbach emphasizes that a larger community of contributors enables solidarity-based redistribution in society. This measure is provided for in the coalition agreement and is considered necessary to make pension insurance sustainable. At the same time, however, there is skepticism about the involvement of civil servants, a process that Roßbach describes as lengthy and easy to plan.

A crucial point in the discussion about pension reform is the possible potential for positive financing effects in the pay-as-you-go system, which could arise if previously uninsured, younger self-employed people are included in compulsory insurance. For civil servants, however, the situation is more complex. Roßbach points to the example of Austria, where the transition to the pension fund takes at least one working life. Only the contributions of the civil servants involved would have to be used to finance today's pensions, which would not have a positive financial effect on the pension insurance in the short term.

Political controversies and resistance

The discussion is further fueled by the statements of Labor and Social Affairs Minister Bärbel Bas (SPD), who also made a proposal to include civil servants, politicians and the self-employed in the pension fund. However, this proposal is met with resistance within the Union, represented by the head of the Chancellery, Thorsten Frei (CDU). Frei argues that the proposal is not anchored in the coalition agreement and would not represent a viable financing model.

Bärbel Bas justifies her plan with the need to improve the income of the statutory pension insurance. This view is not shared by everyone. The German Civil Service Association has vehemently rejected the proposal, while the Left and the social association VdK welcome it. Economist Monika Schnitzer supports the inclusion of civil servants in the pension system, but still sees the need for a reform of the pension system.

Risks and alternatives

However, economists warn that including civil servants could relieve the burden on pension funds in the short term, but could lead to higher contributions in the long term. An alternative proposal from economists envisages that civil servants and employees pay into different pension funds, which, however, follow the same basic rules. It is also pointed out that there are constitutional hurdles to reforming civil servants' pensions in Germany, which require a decision by the federal and state governments.

The discussion about pension reform is exacerbated by the fact that the average pension in Germany is around 1,200 euros gross after 45 years of insurance, while civil servants receive over 3,000 euros gross. This inequality could potentially be reduced by including all professional groups in pension insurance, but remains a sensitive issue on the political agenda.

The next steps will show whether a consensus can be reached on the comments of various political actors or whether the differences remain irreconcilable. The debate over the inclusion of the self-employed and civil servants is not only an economic but also a social issue that must continue to be discussed in the future. You can find more information about this in the reports from MM News and Mercury.