Germany creates minimum old age for the poorest
Text by: RFI Follow
In Germany, the Council of Ministers adopted this Wednesday, February 19, a bill providing for the establishment of a minimum old age. This reform wanted by the social democrats has been under discussion for several years.
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Read moreWith our correspondent in Berlin , Pascal Thibaut
" The biggest social reform of the legislature ". The Social Democratic Minister for Labor, Hubertus Heil, is satisfied. But the gestation of the text will have been long. We have been talking about this for almost ten years and it will have taken months of painstaking discussions between the Conservatives and the SPD to reach an agreement.
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For the latter, it is social justice: ensuring that a person who has worked all his life receives a decent pension. The aim of the reform is to give a boost to pensioners who have worked their whole life, at least 33 years old, but whose pensions are still too low.
It predicts that from 2021, 1.3 million people will see their pensions revised upwards. The Ministry of Labor gives the example of a hairdresser who, having contributed 40 years earning the minimum wage, will in future receive 960 euros per month instead of 512 euros.
Reform will benefit women
In 70% of the cases, this reform will benefit women who often have low-paid jobs or who work part-time. Retired people in the east of the country will also be more likely to benefit from these new measures.
The unions welcome the reform but would have liked more people to benefit from it. The employers find that it does not fight in a sufficiently targeted way the poverty of the pensioners and judges its costs, 1.3 billion per year financed by the state, too high.
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