The planned pension reform put forth by the federal government is facing resistance from the various states (Bundesländer). Several states are attempting to prevent the 16 carriers of the German Pension Insurance from being consolidated into a centrally controlled organization. This opposition stems from a proposed resolution for the conference of ministers of labor and social affairs, which was reported on by the publication “Zeit.”
The states warn against escalating costs and significant administrative burdens. Furthermore, they argue that a move toward centralization could jeopardise the implementation of other reforms. From their perspective, such a significant shift would lock up substantial resources, potentially delaying other necessary legislative changes. The proposed resolution also stated that regional structures and local responsibilities-which are vital for tailored consultation and rehabilitation services-would be weakened. Therefore, the states wished to maintain the existing federal structure to ensure proximity to insured individuals, employers, and rehabilitation facilities.
This stance is a pushback against a new guiding principle that was part of the recommendations emerging from the Pension Commission. Under the proposed model, the 14 regional carriers would be transformed into regional directorates, following the pattern of the federal employment agency. Under this system, only one of the two federal trustees would handle pension matters, and the central committees and self-governing bodies of the individual carriers would largely be abolished. This project has faced strong opposition from trade unions, who feel this reduces democratic co-determination.
Instead, the states are proposing an alternative: initially consolidating the currently separate IT structures into a joint system house-a central IT organization-and accelerating decision-making through adjusted majority rules. A working group involving the federal government and all pension insurance carriers is also planned to review further reforms within two years.
This resolution is scheduled for discussion at the conference of ministerial chiefs on October 21 and 22 in Kassel. As of now, the proposers and the voting outcome remain undetermined, indicating that the document is still an internal working draft.
The debate over organizational structure is just one piece of a larger puzzle within the pension reform. According to reports from “Zeit,” the federal government is considering separating the reform into three distinct legislative packages. The first package might include changes to pension and social insurance law, while a second package could cover prevention and rehabilitation. The new capital pension system and the organizational reform could potentially be moved into a later third package, the same publication noted. However, other media reports suggest that the organizational reform may already be included in the first package. The Coalition Committee may address the procedure on October 7, but the overall timeline remains unclear.
