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

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 print editions delivered to you directly


Online edition
Previous editions

Don't miss

  • “Nizip” refugee camp visit
    July 2016: OECD Secretary-General Angel Gurría visits the “Nizip” refugee camp, situated between Gaziantep and the Turkish-Syrian border, accompanied by Turkey’s Deputy Prime Minister Mehmet Şimşek. The camp accommodates a small number of the 2.75 million Syrians currently registered in Turkey, mostly outside the camps. In his tour of the camp, Mr Gurría visits a school, speaks with refugees and gives a short interview.
  • OECD Observer i-Sheet Series: OECD Observer i-Sheets are smart contents pages on major issues and events. Use them to find current or recent articles, video, books and working papers. To browse on paper and read on line, or simply download.
  • Queen Maxima of the Netherlands gives a speech next to Mexico's President Enrique Pena Nieto (not pictured) during the International Forum of Financial Inclusion at the National Palace in Mexico City, Mexico June 21, 2016.
  • How sustainable is the ocean as a source of economic development? The Ocean Economy in 2030 examines the risks and uncertainties surrounding the future development of ocean industries, the innovations required in science and technology to support their progress, their potential contribution to green growth and some of the implications for ocean management.
  • OECD Environment Director Simon Upton presented a talk at Imperial College London on 21 April 2016. With the world awash in surplus oil and prices languishing around US$40 per barrel, how can governments step up efforts to transform the world’s energy systems in line with the Paris Agreement?
  • Happy 10th birthday to Twitter. This 2008 OECD Observer interview with Henry Copeland said you’d do well.
  • 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.
  • Once migrants reach Europe, countries face integration challenge: OECD's Thomas Liebig speaks to NPR's Audie Cornish.

  • Message from the International Space Station to COP21

  • COP21 Will Get Agreement With Teeth: OECD Secretary-General Angel Gurría on Bloomberg

  • The carbon clock is ticking: OECD’s Gurría on CNBC

  • If we want to reach zero net emissions by the end of the century, we must align our policies for a low-carbon economy, put a price on carbon everywhere, spend less subsidising fossil fuels and invest more in clean energy. OECD at #COP21 – OECD statement for #COP21
  • They are green and local --It’s a new generation of entrepreneurs in Kenya with big dreams of sustainable energy and the drive to see their innovative technologies throughout Africa. blogs.worldbank.org
  • Pole to Paris Project
  • In order to face global warming, Asia needs at least $40 billion per year, derived from both the public and private sector. Read how to bridge the climate financing gap on the Asian Bank of Development's website.
  • How can cities fight climate change?
    Discover projects in Denmark, Canada, Australia, Japan and Mexico.
  • Climate: What's changed, what hasn't, what we can do about it.
    Lecture by OECD Secretary-General Angel Gurría, hosted by the London School of Economics and Aviva Investors in association with ClimateWise, London, UK, 3 July 2015.

  • Climate change: “We should not disagree when scientists tell us we have a window of opportunity–10-15 years–to turn this thing around” argues Senator Bernie Sanders.

  • In the long-run, the EU benefits from migration, says OECD Head of International Migration Division Jean-Christophe Dumont.
  • Is technological progress slowing down? Is it speeding up? At the OECD, we believe the research from our Future of ‪Productivity‬ project helps to resolve this paradox.
  • Is inequality bad for growth? That redistribution boosts economies is not established by the evidence says FT economics editor Chris Giles. Read more on www.ft.com.
  • Catherine Mann, OECD Chief Economist, explains on Bloomberg why "too much bank lending can slow economic growth".
  • 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 .

Most Popular Articles

Poll

What issue are you most concerned about in 2016?

Unemployment
Euro crisis
International conflict
Global warming
Other

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 2016