Würzburg (Dpa) – Despite the expected recession in Germany, the financial forecasts for the 21 million retirees in the coming years are initially positive. The German Pension Insurance Association confirmed Wednesday in Würzburg that pensions are likely to increase by around 3.5% in West Germany and more than 4% in East Germany over the next year. “We have simply record employment,” said President Gundula Roßbach. Roßbach pointed out that the increase in income from compulsory labor contributions was particularly significant, with a 5.4 percent increase this year.
The chairman of the Federal Board of Pension Insurance, Anja Piel, said: “Of course we are pleased that this has developed relatively more favorably than expected last year.” Official estimates also assume further significant increases in pension fund income for the next few years, as Piel pointed out. Mandatory contributions from gainful employment would increase by around 16.1 percent by 2026.
higher mortality
In addition to the labor market and the wage situation in Germany, which is favorable to the pension fund, life expectancy on average is not increasing as much as previously thought, as Co-President Alexander Gunkel announced. The background is the increased mortality due to the corona pandemic. This tends to have a dampening effect on pension fund spending. Immigration to Germany is also having a positive effect, Gunkel said. As a result, more people have paid into the pension fund.
However, representatives of pension insurance stressed the uncertainties of the forecasts due to the economic crisis. “The uncertainties are certainly as great in this economic development as they were in a few years earlier,” Gunkel said. Furthermore, the pension insurance has confirmed that the financial situation of the pension fund is set to deteriorate in the medium term after the positive developments, as the baby boom generation increasingly retires.
