May 29, 2023

Union and spd continue to wrestle over basic pension

Union and spd continue to wrestle over basic pension

Millions of people with mini- pensions must continue to wait for a decision by the black-red coalition on a surcharge.

A top-level coalition meeting on the basic pension planned for monday evening was unexpectedly postponed until next sunday – the CDU announced on sunday afternoon that there were still open points that should be carefully clarified in the course of this week.

The SPD confirmed the postponement. A spokesman said: "the working group had done very good preliminary work, but there is still a need for clarification. The SPD remains confident that an agreement will be reached."A CDU spokesman said the coalition’s working group had done important preliminary work and had moved positions toward one another. But there are still open points.

As the german press agency has learned from SPD circles, the postponement of the summit meeting was initiated by the union. It was initially unclear whether there would be a meeting of the coalition working group before the meeting, which is now scheduled for sunday.

Federal economics minister peter altmaier called the postponement of the meeting a "good and correct decision". "Progress is only possible with solid and sustainable financing and clarity in the needs assessment," the CDU politician wrote on twitter on sunday evening.

Norbert rottgen, the CDU’s expert on the issue, said on the ZDF program "berlin direkt": "for us, it is a question of principle whether, for the first time, we are decoupling a social benefit financed by the solidarity of taxpayers from the neediness of the person receiving the benefit." That would be a "fundamentally wrong switch", warned rottgen.

Over the weekend, leading CDU/CSU politicians insisted on a strict means test in the negotiations on the basic pension. In return for a surcharge on minimum pensions in view of the economic slowdown, they also want tax relief for companies.

Federal health minister jens spahn (CDU) had named conditions for an agreement to be reached on the basic pension and rejected reports of an initial compromise. "Nothing is agreed."Spahn wrote on twitter on saturday that the basic pension must have a "hard income assessment" as a means test – so that only pensioners are supported who had very little to live on despite working for more than 35 years. Pensioners with rental income do not belong to it.

In addition, the total volume must be responsible for future generations. "Every billion-dollar sum that the SPD has named to date is not," wrote spahn, who is a member of the working group. Third, at the same time, concrete measures for more economic growth had to be agreed upon, such as a reduction in corporate taxes. A competitive economy is a prerequisite for any pension system. "Before distributing always comes earning."

The chairman of the "young group" in the union faction, mark hauptmann, told the "ZDF-hauptstadtstudio" on sunday: "we as the ‘young group’ reject a basic pension without a call for means-tested benefits, because this is neither social nor fair. The costs of a young generation are being passed on for many years into the future – and new injustices are being created."The union should not move one millimeter away from what was agreed in the coalition agreement, namely a basic pension with means-tested benefits.

The acting SPD chairwoman, malu dreyer, had expressed confidence that an agreement could soon be reached. Dreyer also mentioned conditions. The minister president of rhineland-palatinate told the newspapers of the "funke" media group: "the basic pension should provide more justice and be paid automatically."Nobody should have to "go to the office and fill out a huge pile of forms". The SPD is not concerned with a social benefit, but with the recognition of life’s work. Anyone who has worked for 35 years for a low wage must have more than basic security in old age.

Bavaria’s minister president and CSU leader markus soder reiterated in the "welt am sonntag" newspaper the demand that there must be an internationally comparable reduction in corporate taxation. "Competitiveness and the stabilization of the economy depend on it."The economy in germany has cooled off. At the same time, however, soder had said that there was a good chance that an agreement would be reached in the coalition committee. "At the end of the day, it’s all about the total cost and the structures for basic pensions."

The coalition’s working group had met until early friday morning. Afterwards, the german press agency learned from coalition circles that the word "need-based assessment" was to be dispensed with – but that the tax authorities were to use "taxable income" as the basis for their calculations. This could mean that taxable income from capital transfers or from rentals and leases would also be taken into account.

There is agreement that all those who have 35 years of contributions will receive a pension ten percent above the basic security level. This was also agreed in the coalition agreement. However, the union and the SPD have been arguing for months about who exactly should receive the pension surcharge. The CDU/CSU insists on the test of actual need agreed in the coalition agreement, the SPD rejects it.

The total cost of the basic pension should remain below two billion euros. According to dpa information, the union had insisted on this. It was important to the SPD that as many people as possible should be reached; in the end, there should be about 1.5 million. With the basic pension, people who receive only a very small pension despite having paid contributions for a long time are to receive an additional payment.

According to the coalition agreement, the prerequisite for the basic pension should be a qualifying condition corresponding to the basic income security level. The CDU/CSU wanted to see the assessment of actual need, as agreed in the coalition agreement, guaranteed. However, the SPD then rejected such a test. According to reports, the CDU in particular had reservations right up to the end.

FDP labor market expert johannes vogel called the postponement of the coalition committee a declaration of bankruptcy for the coalition. "Union and SPD should finally admit to themselves that they had completely lost their way on this important issue in a bad model.


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