A simulation calculation shows what the inclusion of civil servants and the self-employed in the pension fund would mean. Why this is not a panacea.
This text first appeared in June 2024. We are republishing it here.
The Council of Experts has calculated that if self-employed people were included in the statutory pension insurance scheme, “small but positive effects” would be seen in the 2030s. When the first of them retire, the relief would decrease again. In 2080, however, the inclusion would still have small positive effects. An extension to future civil servants could also “relieve the financial burden on the pension fund in the short to medium term, if initially only contributors are included, but no additional pensions are incurred”.
According to simulation calculations, this would initially lead to lower contribution rates for all insured persons. “However, the positive effect on the contribution rate is likely to be reversed from the mid-2070s onwards due to the long-term higher pension benefits,” say the economists.
Tax revenue for the pension fund
Expanding the group of insured persons is therefore not a panacea for restructuring the pension fund. Especially since the state would probably pay civil servants a supplementary pension in addition to the normal pension, just like public sector employees. As of the beginning of 2023, the average pension will be 3,240 euros per month – more than twice as much as the statutory gross pension. Civil servants’ pensions already cost the state over 53 billion euros annually.
The amount would not be eliminated, as today’s pensioners and active civil servants with pension entitlement will live for many decades to come. Civil servants and the self-employed still indirectly finance the pension insurance: through the annual subsidy from tax revenues, currently amounting to 116 billion euros.
Source: Stern
