Overview

• An internal draft sets the 2026 pension and unemployment insurance assessment ceiling at €8,450 per month and the health and long-term care ceiling at €5,812.50, with the insurance‑obligation threshold moving to €6,450.
• For employees above the new ceilings, calculated annual payroll contributions would rise by up to roughly €1,800 in 2026, with higher pension payments later but no benefit gains in health or care insurance.
• The Labour Ministry says the increase follows a statutory formula tied to 2024 wage growth of 5.16%, and the draft has entered interministerial coordination ahead of required cabinet and Bundesrat approvals.
• Economic policymakers escalated calls for structural reform as Economy Minister Katherina Reiche backed a higher retirement age, and an expert panel urged linking retirement to life expectancy and scrapping early‑retirement breaks.
• The coalition’s planned Aktivrente would let retirees earn up to €2,000 tax‑free monthly from January 2026, drawing union and employer criticism over costs and limited impact, with IW estimating €2.8 billion in windfall effects for those already working past retirement.