Overview
- The government proposal would extend the 48% minimum pension level by keeping the sustainability factor suspended, with a provisional projection of about 3.7% gross pension growth from 1 July 2026.
- The Deutsche Rentenversicherung warned that reactivating the sustainability factor from 2026 would dampen adjustments by roughly 2.5 percentage points through 2031, while the pension guarantee rules out cuts to the current pension value.
- Employer representatives and some economists criticized the package as too expensive, with the BDA citing additional costs of about €11.5 billion in 2032 rising to €14.5 billion by 2040.
- Union and social advocates backed stabilization to curb old-age poverty and called for a stronger statutory system, including a broader contributor base or higher target levels.
- The draft has not been approved, the 2026 adjustment will be formally set in spring 2026, and parliamentary decisions on the broader package remain pending.