Pension provision
Would it be helpful if civil servants and self-employed people paid into the pension fund?
A simulation calculation shows what the inclusion of civil servants and self-employed people in the pension fund would have. Why this is not a panacea.
The Council of Experts has calculated it: If self-employed people were included in statutory pension insurance, “small but favorable effects” would be seen in the 2030s. If the first of them retired, the relief would decrease again. In 2080, however, the inclusion would still have minor 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 only contributors are initially accepted, but no additional pensions are incurred”.
According to the simulation calculation, this would initially lead to lower contribution rates for all insured persons. “However, the positive effect on the contribution rate is expected to reverse again from the mid-2070s onwards due to the higher pension benefits in the long term,” say the economists.
Tax funds for the pension fund
Expanding the circle of insured people is therefore not a panacea for restructuring the pension fund. Especially since the state would probably pay civil servants and public sector employees an additional pension in addition to the normal pension. As of the beginning of 2023, the pension amounts to an average of 3,240 euros per month – more than twice as much as the statutory gross pension. Civil servant pensions already cost the state over 53 billion euros annually.
The amount would not go away because 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.
This text first appeared in June 2024.
Published in stern 23/2024
Source: Stern
