Seven German states rebel against coalition plan to abolish 'Rente mit 63' pension
Germany's black-red coalition faces mounting resistance from eight states over its plan to abolish the deduction-free pension after 45 contribution years, with SPD and CDU politicians alike demanding exemptions, transition rules and hardship provisions.
Coalition package under pressure
Germany's black-red coalition agreed at the end of June 2026 to implement all 33 recommendations from the Alterssicherungskommission as a single package. The sixth recommendation calls for abolishing the deduction-free pension for particularly long-insured people after 45 contribution years, a provision commonly known as "Rente mit 63." Chancellor Friedrich Merz (CDU) and Labor Minister Bärbel Bas (SPD) committed to implementing the proposals in full. The deduction-free route currently allows retirement up to two years before the regular retirement age, with the effective entry age at 64.5 years. Around 270,000 people took the deduction-free route in 2025, and the pension for the very long-insured accounts for roughly 30 percent of all new pensions. The DIW estimates the provision costs nearly 10 billion euros per age cohort, with users saving up to 7.2 percent or roughly 132 euros per month at the standard pension level.
- Deduction-free (long-insured)
- 30 %
- Other new pensions
- 70 %
Growing resistance from the states
Seven federal states have announced opposition to the abolition: Saxony, Saxony-Anhalt, Thuringia, Brandenburg, and Mecklenburg-Vorpommern in the east, plus the SPD-led western states of Saarland and Bremen. Lower Saxony's PM Olaf Lies (SPD) has also criticized the plans. The three eastern CDU PMs Michael Kretschmer, Mario Voigt, and Sven Schulze published a joint demand at the end of July to preserve the deduction-free pension after 45 contribution years, with transition periods and hardship rules for physically demanding occupations. Schulze has threatened to block the package in the Bundesrat. The DGB trade union federation supports the states' position, while the BDA employers' association warns against questioning central elements before implementation. Its managing director Steffen Kampeter told Bild-Zeitung the pushback left him "speechless."
- Coalition agrees to implement all 33 pension commission proposals as a single package
- Three eastern CDU PMs (Kretschmer, Voigt, Schulze) publish joint demand to preserve deduction-free pension after 45 contribution years
- Seven states formally oppose abolition; SPD's Wiese proposes Austrian Schwerarbeitspension as compromise model
Calls for compromise within the SPD
SPD parliamentary business manager Dirk Wiese advocates keeping the abolition in principle but adding hardship exceptions for workers in physically demanding jobs, particularly shift workers. He pointed to Austria's Schwerarbeitspension, introduced in 2007, as a possible model. The Austrian system uses a fixed list of professions classified as demanding by the Labor Ministry in Vienna, enabling early retirement from age 60 for people who have worked under heavy physical or psychological strain, including night shifts, extreme temperatures, chemical exposure, or heavy manual labor. The pension commission's own tenth recommendation proposes allowing deduction-free retirement two years before the regular age for those whose health prevents them from continuing in their long-held profession, but this requires an individual health check. Wiese's Austrian model would also cover people without health damage. He also called for trust protection rules lasting about five years, noting that many people have planned their lives around current regulations.
It's like a Jenga tower: if you pull out a block, the whole thing becomes unstable.
Union figures hold the line
Union faction leader Thorsten Frei insisted on keeping the abolition, warning that removing individual elements would destabilize the entire package.
Whoever pulls out one of the building blocks must expect further change requests, and in the end brings the whole building to collapse.
Frei said the abolition would avoid billions in spending and that he had heard no proposal for how to compensate for that sum. NRW Health Minister Karl-Josef Laumann (CDU) also urged viewing the commission's proposals as a whole, including both the abolition and the raising of the retirement age. After 2031, the retirement age is set to be gradually linked to rising life expectancy. CDU workers' chief Dennis Radtke, however, called for reliable transition rules for particularly long-insured people.
Schwesig's generational argument
Mecklenburg-Vorpommern's PM Manuela Schwesig (SPD) went further than other critics, demanding that even today's 16-year-olds be guaranteed a deduction-free pension at 63 after 45 years of contributions. She argued that people who start working early should not have to work longer than those who begin their careers later.
What do you want to say today to a young man, a young woman who leaves school at 16, immediately does an apprenticeship and starts working? That they have to work and pay in longer than someone who doesn't start until 26?
