Old-age pension
The Bundestag’s old-age pension scheme is a necessary element in the provision of Members’ remuneration adequate to secure their independence.
Only someone who has been a Member of the Bundestag for eight years (two electoral terms) is entitled to an old-age pension. Anyone who leaves Parliament with fewer years of service may apply to be retroactively insured within the statutory pension-insurance system or have an equivalent amount of money paid out as a lump sum – in which case they waive any pension entitlements for the period in question.
Members’ old-age pensions - unlike normal pensions in Germany at present - are fully taxable and are set off against other income from public funds, such as pension entitlements from statutory pension insurance. Furthermore, Members have no right to take out the state-subsidised pension insurance policies known as “Riester pensions” after the minister under whom they were introduced.
When the Act on the Legal Status of the Members of the German Bundestag was amended in 1995, clear cuts were made to the parliamentary old-age pension scheme. The rates of increase and the maximum rate have been reduced. A Member who has had an average career in Parliament lasting 12 years now receives only 36% of current remuneration as an old-age pension (previously 51%). This structural reform has had an effect comparable to that of the sustainability factor recently introduced in the statutory pension system and has eased the burden on the public purse. The reduction in the size of the German Bundestag as of the 15th electoral term has had the same effect because it means that, in future, fewer Members will draw old-age pensions.
Further cuts were agreed in 2004 as a way of holding down costs. In consequence, Members’ old-age pensions are gradually being reduced by a further 2%. This will mean that a former Member who served in Parliament for 12 years will draw 34% of the current level of remuneration. The surviving dependents’ pension has been reduced from 60% to 55% of the old-age pension to which the deceased person would have been entitled.
