45 years of insurance – that sounds like a lot of pension. But more than a million people in Germany have to make do with meager benefits even after such a long time of paying in.
Around one in five people in Germany with at least 45 years of insurance only receive a pension of less than 1,200 euros. This is shown by a response from the federal government to Sahra Wagenknecht, head of the Bundestag group BSW named after her, which was made available to the German Press Agency in Berlin. At the end of last year, the pension payment amount was less than 1,200 euros a month, at around 1.08 out of 5.40 million old-age pensioners with at least 45 years of insurance.
In the eastern German states, the proportion of those who have been insured for a particularly long time and receive a small pension is even higher than in the west. In Brandenburg, for example, around 71,000 people receive a pension of less than 1,200 euros after 45 years, while 212,000 of these pensioners who have been insured for a particularly long time receive more than that. In Saxony, the ratio is 145,000 to 363,000, while in Thuringia, 74,000 receive a lower pension and 189,000 receive a higher pension.
Wagenknecht also asked about the average pension after at least 45 years of insurance – the answer: 1,604 euros nationwide. In the west it is – as of December 2023 – 1,663 euros, in the east 1,471 euros. Led by Hamburg with 1,721 and North Rhine-Westphalia with 1,709 euros, all western German states and Berlin are above 1,600 euros.
Tax havens
Dolce Vita in old age – in these countries pensioners get more out of their money
These include: Brandenburg (1,500 euros), Saxony (1,458), Mecklenburg-Western Pomerania (1,455), Saxony-Anhalt (1,452 euros) and, at the bottom, Thuringia (1,437 euros) – the eastern German states. However, Wagenknecht only asked about pensions after at least 45 years. The average pensions are different: they are higher in the east than in the west – because many people have worked longer here, especially women.
Wagenknecht request sparks pension debate
“1,604 euros average pension after at least 45 years of work – this figure shows how poorly the German pension insurance system is performing,” Wagenknecht told the DPA. “The fact that one in five pensioners receives less than 1,200 euros in pension after 45 years of work is a political scandal.”
Wagenknecht expects the upcoming federal election campaign to also include a referendum on statutory pensions, as the former Left Party leader said. “The Germans should no longer accept such low pensions, which are then also heavily taxed,” she said.
Why is the pension so low?
There are several reasons for low pensions. Firstly, many self-employed people, civil servants and housewives receive a statutory old-age pension because they paid contributions into the pension insurance scheme for at least five years at some point in their lives, as the Federal Institute for Population Research explains. Five years is the minimum period for a pension. The resulting benefits remain low.
Longer breaks from work, more part-time work and lower wages also reduce pensions for many West German women. In its response to Wagenknecht, the Federal Ministry of Labor also stressed that the level of pension cannot be used to determine the level of overall income. Many senior citizens have additional income. The ministry also referred to the household context – that is, cases where partners usually have a small pension but an adequate overall situation.
Role model Austria?
Wagenknecht calls for Germany to follow the example of a neighboring country – Austria. There, the average pension for those who have been insured for a long time is 800 euros higher. “What is possible there must also be possible here,” said Wagenknecht. “We need higher pensions based on the Austrian model and a pension tax brake.” Compared to the EU average, the pension level in Germany is around ten percentage points too low.
What is striking when comparing pensions with Austria? In fact, pensions are noticeably earlier and higher. The main reason is a pension reform around 20 years ago: almost all working people in the neighboring country pay into the statutory pension fund, including state employees. Both the tax subsidy for the pension and the contribution rates are significantly higher than in Germany.
In Austria, you only receive a pension after 15 years. This is another reason why average pensions are higher. The contribution rate is higher in Austria than in Germany. The employer pays more than the employee, and the distribution is not equal.
Source: Stern
