Monday 29 November 2021
Pensions should rise more slowly
Ex-economy welcomes “catching up factor”
In the pandemic, workers are affected by short-time work and unemployment. The senior citizens are spared due to the statutory pension guarantee. According to the plans of the traffic light coalition, an increase should therefore be lower. An earlier “economy” welcomes the “catching up factor”.
The former chairman of the “Wirtschaftsweise”, Lars Feld, thinks it makes sense that pensions should rise less sharply in the coming year than previously expected. Feld said: “It cannot be that pensioners are spared pension cuts in the wake of a recession through a pension guarantee, but then profit from the wages and salaries rising again with massive pension increases. Without the catching-up factor, pensioners would be absolute crisis winners. The employees, on the other hand, bear the full burden of the recession and would have to pay more for the pension insurance in the long term without catching up. “
The pension increase in the coming year is expected to be less pronounced than previously expected. With a view to the coalition agreement between the SPD, Greens and FDP, Federal Labor Minister Hubertus Heil told “Bild am Sonntag”: “The forecast was 5.2 percent. Now I expect pensions in Germany to rise by 4.4 percent from July 2022 . That’s still very neat. ”
2021 clear round in the west, slight increase in the east
This year, the corona pandemic resulted in a zero rate for pensions in the west, in eastern Germany there was an increase of 0.72 percent. The reason for the less strongly rising pensions in the coming year is that the traffic light coalition wants to activate the so-called catch-up factor again. The employers welcomed this step, criticism came from the German Trade Union Confederation.
The pension guarantee, which has been anchored in law since 2009 in the wake of the financial and economic crisis, prevents pension cuts if the wage bill falls. In return, a catching-up factor should ensure that, if wages rise again, the prevented pension reduction is mathematically compensated – i.e. the pension does not rise as much. The aim was to ensure that the pension guarantee does not lead to a permanent additional burden on the contributors. The black-red coalition had suspended the catch-up factor from 2018 to June 2026.
Feld currently holds the chair for economic policy and regulatory economics at the Albert-Ludwigs-Universität Freiburg and is director of the Walter Eucken Institute. Until the end of February, he was chairman of the Advisory Council for the assessment of macroeconomic developments. The experts are also known colloquially as the “economic wise men”.