Concerns are being raised by the President of the German Caritasverband, Eva Maria Welskop-Deffaa, regarding proposed pension reforms, specifically the planned “early retirement” scheme and the efforts to stabilize the pension level.
Welskop-Deffaa voiced her reservations in an interview with T-Online, stating that allowing pensioners to earn up to €2,000 tax-free while younger parents with rising incomes face full income tax progression creates “difficult-to-explain injustices” between generations. She questioned the fairness of offering tax benefits to retirees at the expense of younger families.
Furthermore, she views the fixation on maintaining a specific pension level as an oversimplified metric. According to Welskop-Deffaa, this figure provides limited insight into the actual disposable income of pensioners. She emphasized the importance of ensuring that individuals who have contributed to the pension system for decades receive a pension sufficient to cover their basic needs. Failure to do so, she warns, undermines public trust in the system. She suggested a differentiation within the pension formula, accounting for those who have contributed based on smaller incomes versus those contributing from larger incomes. Welskop-Deffaa believes a system of greater solidarity in this regard is consistent with the current financing of the pension insurance.
Finally, Welskop-Deffaa strongly advocates for mandatory pension insurance for self-employed individuals. She described this as a long overdue measure, noting the increasing prevalence of hybrid working arrangements where individuals combine employment and self-employment. She argues that only paying pension contributions on a portion of their income results in a correspondingly reduced pension later in life. This reform has been promised by several coalition governments but has yet to be implemented and she urged for its successful realization this time.
