“After a long dispute, the Bundestag is to adopt by the end of the week the improvement of low pensions planned by the grand coalition. Although the financing of the so-called basic pension is not yet satisfactory, the Union wants to agree, CSU Land Group leader Alexander Dobrindt made clear in Berlin on Tuesday. It is a question of creating security for the pensioners concerned.
For this reason, it is accepted that the funding comes from the federal budget as long as there are no other financing options. The Federal Council could also approve this next Friday before the summer recess. Dobrindt stressed that his party had always wanted the basic pension.
The Basic Pension Act is due to start on 1 January 2021. The aim is to improve the pensions of around 1.3 million people with small salaries. The cost is estimated at 1.3 to 1.6 billion euros per year.
There was anger in the Union that the basic pension was to be financed by a tax on financial transactions, which was not in sight either in Europe or nationally when the grand coalition of the Union and the SPD was agreed. The Union has also recently called for the project to be postponed or put on hold because of the financial burden of the Corona crisis.
But the SPD should not be given the opportunity to play the summer months with a pension issue, Dobrindt argued. This is the strategic background for the issue of basic pensions to be concluded this Friday, despite outstanding financing issues. It was also possible that the Bundestag would deal with the issue in second and third readings as early as Thursday.
Criticism of the Minister for Labour
Dobrindt went to court with Employment Minister Hubertus Heil (SPD). Discussions with Heil on the design and financing had been difficult until the very end, because all the financing commitments had not been honoured. The 400 million euros announced by Heil from the budget of the Ministry of Labour have not yet been secured. One cannot be very satisfied with the work of Heil.
Even with the financial transaction tax promised by Finance Minister Olaf Scholz (SPD), there is still no sign that there will be rapid implementation. Dobrindt stressed that he wanted a European financial transaction tax , but so far Scholz has not made the necessary proposals.
Dobrindt also criticized the administrative process of the basic pension. In the case of pension insurance, for example, it is assumed that it will be necessary to complete the relevant files by the end of 2022. Then you think you had every file in your hand.
The director of the German Pension Insurance Confederation, Stephan Fasshauer, had recently said that people who are already retired and are entitled to the supplement are not expected to receive their notices until the end of 2022. Fasshauer also reiterated earlier statements that the basic pension is not expected to come until six months after its planned official start. It is a great administrative burden to filter out from the almost 26 million pensions those who could be entitled to the supplement, the pension insurance company said.