Overview

• The draft law raises the statutory pension contribution rate from 18.6% to 18.8% of gross wages in 2027 and mandates increasing reserves to 30% of one month’s payouts to reinforce the DRV’s financial cushion.
• It secures the pension replacement rate at 48% of average earnings through 2031 while extending Mütterrente for pre-1992 children and launching the Aktivrente to permit up to €2,000 in tax-free post-retirement earnings.
• DRV board member Alexander Gunkel has warned that current reserves could fall to the legal minimum of 0.2 months’ expenditures by autumn 2027, risking temporary payment shortfalls.
• More than 3.5 million retirees—about 15%—live on under €1,380 net per month, highlighting growing pensioner poverty and the role of Grundsicherung and supplemental benefits.
• A proposal to slow future pension indexation for high earners has been denounced as a “system breach” by former DRV head Franz Ruland, crystallizing tensions between equity and sustainability.