The employer association Gesamtmetall has publicly opposed the five-year transition period favored by Federal Labor Minister Bärbel Bas (SPD) regarding the “pension at 63.” Oliver Zander, the association’s managing director, told the Handelsblatt that the proposal is “simply not financially viable.” He stated that the push by the provincial leaders of the East, who wish to maintain the “pension at 63,” ignores the fact that increasing the value of East German pensions costs nearly 40 billion euros annually-and this is funded by contributions, 80 percent of which come from West Germany.
Zander warned that despite all ongoing reforms, social security contributions are projected to rise to 45 percent by 2028, and to 48 percent for childless individuals with a contributing spouse. Currently, these rates stand at 42.3 and 43.1 percent, respectively.
The association perceives the highest need for action in the healthcare system’s costs. He pointed out that medical insurance expenditure is increasingly eclipsing pension costs. Whereas the contribution rate for healthcare was 13.6 percent in 2000, it is projected to reach 17.5 percent by 2026. Consequently, the share of healthcare in the total social security contribution has risen from 33 percent to 41 percent. Therefore, Zander insists that “massive savings” must be made within the medical sector, including physicians, hospitals, and the pharmaceutical industry. He further suggested that it is “no coincidence” that investors are heavily investing in these areas, as they generate large profits-often at the expense of contributors. He concluded by noting that doctors and hospitals are the only sector that receives a flat-rate allowance from contributions to cover the costs of IT systems needed for billing.
