If you only look at the current financial situation of the statutory pension insurance, you will find no problem.

Not even the Corona crisis has so far left serious marks on the largest German social security fund: at the end of 2020 it had more than 37 billion euros in reserves, so its reserves for future increases in expenditure were still close to the historic high of 2019 the German pension insurance.

Dietrich Creutzburg

Business correspondent in Berlin.

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The picture is incomplete if the official projections are left aside: They say that the reserve will shrink to 16 billion euros by the end of 2022. More than half would be used up in the first year after the federal election. And in 2023 the contribution that employees and employers pay will have to increase from 18.6 to 19.3 percent of gross wages, according to the forecast. Otherwise the pension fund would run empty.

In addition, more and more insured people from the baby boom cohorts during the economic boom will retire in the coming years.

For those born in 1955, the time has come this year.

And born in 1964, the strongest ever, is in 2031.

The government's official pension commission has calculated that, on the one hand, the number of pensioners will rise by 4 million over the next 20 years.

On the other hand, the group of contributors will shrink by 3 million people.

The election year 2021 is the "eve of demographic change", formulates the German Economic Institute.

All parties want rising pensions

However, this fact is hardly reflected in the parties' election manifestos. Although there are gradations in the details, almost all of them agree on one goal: In the future, pensions should rise more sharply than previously stipulated by law. The participation of the elderly in the financial burden of demographic change is to be reduced. This is the core of all plans to set new "stop lines" for the parameter "pension level".

"We stand for a permanent pension level of at least 48 percent," says the SPD.

"The long-term securing of the pension level at at least 48 percent is a high priority for us," says the Greens.

The Left Party is even promising 53 percent.

And the CDU / CSU also want to support this parameter: From now on, a new pension advisory board should regularly propose “perspective holding lines for pension level and contribution rate”.

"Pension level" parameter 

If you want to understand the plans in more detail, you have to deal with the current legal situation and the size of the “pension level”. The latter puts the pension of average earners with 45 contribution years in relation to the current average wage - and in 2020 was 48 percent. The important thing is that the prospect that this percentage could decrease in the future does not mean that pensions will also decrease.

In fact, it is about the speed of the increase: Those who guarantee a 48 percent pension level promise annual pension increases at least in step with the general rise in wages.

Those who increase the pension level let the pensions rise faster than the wages.

On the other hand, regular inflation compensation for pensioners would be tantamount to a falling pension level.

The government is currently assuming that pensions - according to the rules that apply today - will increase by 32 percent by 2034, by 2 percent every year.

The pension level would then drop to 45 percent because wages are expected to rise somewhat more sharply.

The strongest demographic change

Until recently, a falling pension level was even an official goal of politics. Because technically, the so-called sustainability factor in the pension formula, which the red-green coalition once decided, takes care of this: In order to protect the younger generation from being overburdened by excessive contributions and taxes, the increase in pensions should lag behind the increase in wages if the number of pensioners grows. But in 2019 the Union and the SPD suspended this mechanism - initially for a limited period until 2025.