Germany should consider raising the retirement age to 69 years by 2060, from about 65 today, unless you want risk being unable to pay pensions in the future, the central bank said.
The state pension system is healthy today, but will remain under pressure as the baby-boomers (born around the 1960s generation) retire and fewer young workers to replace them, he said the Bundesbank in a report (See also: If it rains there …).
Germany is scheduled to gradually raise the retirement age to 67 years by 2030.
The central bank warns that the current system adopted in the first term of Chancellor Angela Merkel (2005-2009), is not sustainable due to the progressive increase in life expectancy and falling birth rates.
The Bundesbank estimates that this increase will not be enough for the German government to maintain state pensions to the level that aims -of at least 43 percent of average- income from the 2050s onwards, due to increased life expectancy of the population.
to prevent too contributions rise or levels of pensions sink, the Government should consider postponing the retirement age to 69 years 2060, the central bank said.
“It is inevitable to make more changes to ensure financial sustainability (the state pension system),” the Bundesbank said in its monthly report.
However, it is unlikely that the proposal will be addressed at the political level before the elections of 2017. The spokesman of the German Executive, Steffen Seibert, said that “the German government defends retirement at 67, that is a sensible and necessary measure given the demographic development in Germany. So we will implement it as we agreed. Step by step “
The Finance Minister Wolfgang Schaeuble, was criticized by his Social Democratic coalition partners in April when he proposed linking the retirement age to expectation of life.
Reuters
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