The Pensions Commission estimates that the proposed new capital-backed pension scheme will generate significant additional pensions for insured individuals over the long term. Preliminary calculations suggest that, on average, an individual who reaches the standard retirement age could receive €150 more per month in the capital pension after 20 years of savings. For those saving for 45 years, this additional amount could exceed €770 per month.
According to Tabea Bucher-Koenen, a commission member, these figures represent real values, adjusted for the price level of 2026. Bucher-Koenen is a professor and head of the research area “Old-Age Provision and Sustainable Financial Markets” at the Mannheim ZEW Institute.
The Commission recommends the rapid introduction of a capital-backed supplementary provision within the statutory pension system, citing Sweden as a model. Jörg Rocholl, a commission member and president of the Berlin School of Economics and Management (ESMT), noted that integrating capital backing would help mitigate the effects of demographic change, stating that the concept holds vast potential and “could be a breakthrough for our country.”
The new capital pension is planned to be funded through additional mandatory pension contributions amounting to two percent. These contributions would be shared equally between employees and employers. Despite concerns regarding rising labor costs, Rocholl expressed hope that the private sector would support the measure. While the apprehensions of businesses are serious, he also pointed out that employers have a vested interest in a long-term, stable system. Given the superior macroeconomic advantages this capital pension offers the country, he hopes that individual business interests will give way to the greater good.
