Germany

Reliability and affordability

©REUTERS/Fabrizio Bensch

No country can detach itself from globalisation and demographic trends, and Germany is no exception. On the contrary, Germany bears a special burden, owing to the impact of German reunification. With Agenda 2010, the government introduced a number of reforms to improve the economic framework and modernise our social systems. Since 2001, we have been implementing, with our pension reforms, a concept which combines reliability with affordability.
A sustainability factor was introduced to ensure that the demographic burden is borne equally by both those paying into the system and the pensioners themselves. Not only do these measures serve to protect the rights of pensioners, at the same time, the contributors–and companies–are protected from rising contribution rates. That is why the law is called the Pension Insurance Sustainability Act. This, too, is a question of social balance: if there is little left to share around, then for the gainfully employed, our children and grandchildren, pensions will not increase either, or will do so only negligibly.The statutory pension insurance remains the centre piece of providing security in old age. However, it will not be enough on its own to guarantee the same standard of living in old age. The supplementary, capital-based funded provision will become increasingly important–alongside the statutory pension insurance–and has consequently been receiving state financing since 2001. It is predominantly families and low-income earners who are receiving assistance in creating funded supplementary old-age provision. Basic protection has served to spread a net against oldage poverty, and early retirement options are being phased out. If old-age protection is to remain stable in the future, it is imperative that older citizens continue to be given a chance on the labour market.Signs of success are already evident. The contribution rates have been kept stable, despite the difficult economic situation in Germany in recent years. The average effective pension age has increased and oldage poverty has decreased. More and more of our citizens are supplementing their old-age provision. In short, old-age protection in Germany has a future.©OECD Observer No. 248, March 2005 See also replies by five other OECD ministers: Australia’s minister for family and community services, Kay Patterson, Netherlands' minister for social affairs and employment and chair of the 2005 OECD social affairs meeting, Aart Jan de Geus, Korea’s Geun Tae Kim, minister for health and welfare and co-chair of the 2005 meeting, Sweden’s minister for social affairs, Berit Andnor, who is also co-chairing, and from the US, Wade F. Horn, who is assistant secretary for children and families at the DHHS.


Economic data

GDP growth: +0.6% Q2 2018 year-on-year
Consumer price inflation: 2.9% Sept 2018 annual
Trade: +2.7% exp, +3.0% imp, Q4 2017
Unemployment: 5.2% Sept 2018
Last update: 13 Nov 2018

E-Newsletter

Stay up-to-date with the latest news from the OECD by signing up for our e-newsletter :

Twitter feed

Suscribe now

<b>Subscribe now!</b>

To receive your exclusive paper editions delivered to you directly


Online edition
Previous editions

Don't miss

  • Globalisation will continue and get stronger, and how to harness it is the great challenge, says OECD Secretary-General Gurría on Bloomberg TV. Watch the interview here.
  • OECD Secretary-General Angel Gurría with UN Secretary-General António Guterres at the 73rd Session of the UN General Assembly, in New York City.
  • The new OECD Observer Crossword, with Myles Mellor. Try it online!
  • Watch the webcast of the final press conference of the OECD annual ministerial meeting 2018.
  • Listen to the "Robots are coming for our jobs" episode of The Guardian's "Chips with Everything podcast", in which The Guardian’s economics editor, Larry Elliott, and Jeremy Wyatt, a professor of robotics and artificial intelligence at the University of Birmingham, and Jordan Erica Webber, freelance journalist, discuss the findings of the new OECD report "Automation, skills use and training". Listen here.
  • Do we really know the difference between right and wrong? Alison Taylor of BSR and Susan Hawley of Corruption Watch tell us why it matters to play by the rules. Watch the recording of our Facebook live interview here.
  • Has public decision-making been hijacked by a privileged few? Watch the recording of our Facebook live interview with Stav Shaffir, MK (Zionist Union) Chair of the Knesset Committee on Transparency here.
  • Can a nudge help us make more ethical decisions? Watch the recording of our Facebook live interview with Saugatto Datta, managing director at ideas42 here.
  • The fight against tax evasion is gaining further momentum as Barbados, Côte d’Ivoire, Jamaica, Malaysia, Panama and Tunisia signed the BEPS Multilateral Convention on 24 January, bringing the total number of signatories to 78. The Convention strengthens existing tax treaties and reduces opportunities for tax avoidance by multinational enterprises.
  • Rousseau
  • Do you trust your government? The OECD’s How's life 2017 report finds that only 38% of people in OECD countries trust their government. How can we improve our old "Social contract?" Read more.
  • Globalisation’s many benefits have been unequally shared, and public policy has struggled to keep up with a rapidly-shifting world. The OECD is working alongside governments and international organisations to help improve and harness the gains while tackling the root causes of inequality, and ensuring a level playing field globally. Please watch.
  • Checking out the job situation with the OECD scoreboard of labour market performances: do you want to know how your country compares with neighbours and competitors on income levels or employment?
  • Trade is an important point of focus in today’s international economy. This video presents facts and statistics from OECD’s most recent publications on this topic.
  • The OECD Gender Initiative examines existing barriers to gender equality in education, employment, and entrepreneurship. The gender portal monitors the progress made by governments to promote gender equality in both OECD and non-OECD countries and provides good practices based on analytical tools and reliable data.
  • Interested in a career in Paris at the OECD? The OECD is a major international organisation, with a mission to build better policies for better lives. With our hub based in one of the world's global cities and offices across continents, find out more at www.oecd.org/careers .
  • Visit the OECD Gender Data Portal. Selected indicators shedding light on gender inequalities in education, employment and entrepreneurship.

Most Popular Articles

OECD Insights Blog

NOTE: All signed articles in the OECD Observer express the opinions of the authors
and do not necessarily represent the official views of OECD member countries.

All rights reserved. OECD 2018