German pension commission recommends linking retirement age to life expectancy and scrapping 'pension at 63'
A government-appointed commission has recommended tying the German retirement age to life expectancy, abolishing early pensions after 45 contribution years, and building a capital-funded pillar, drawing both sharp criticism and praise ahead of its official handover.
Commission's core recommendations
The pension commission, chaired by administrative scientist Constanze Janda and former Federal Employment Agency head Frank-Jürgen Weise, met for around 150 hours. Its members reached broad consensus on a set of proposals designed to secure living standards in old age, particularly for small and medium incomes, through a mix of statutory, occupational and private provision. The most contested measures include a gradual increase of the retirement age in line with life expectancy over the coming decades, the elimination of the so-called 'pension at 63' (the option to retire early without deductions after 45 contribution years), and the introduction of a contribution-financed capital pillar that would, in the commission's view, enable higher pensions for younger cohorts than under current law. Additionally, the commission recommends that civil servants, the self-employed and members of parliament be brought into the statutory pension system. The experts are expected to formally present their final report to the Merz government at the Chancellery on Tuesday, 23 June.
Political reactions
The proposals have already divided political opinion. Monika Schnitzer, chair of the German Council of Economic Experts (SVR), praised the recommendations, noting that many align with the SVR's 2023 advice. She highlighted the link to life expectancy, the rollback of the 'pension at 63', the capital-funded component and the inclusion of additional groups as particularly sensible. Hubert Hüppe, head of the CDU-affiliated Seniors' Union, urged rapid implementation and called the package 'balanced and moderate.'
The government should basically follow the proposals. Dispute would now be bad for everyone -- for pensioners, young people, and especially for democracy.
Opposition came swiftly from the left. Juso chair Philipp Türmer told the Funke media group that linking the retirement age to life expectancy is 'socially unjust and goes at the expense of those who are just starting a life of hard work.' He described the core of the package as unacceptable. Left Party Bundestag leader Sören Pellmann went further in an interview with Tagesspiegel, accusing the commission of delivering the cuts the Merz government had ordered.
With the raising of the retirement age and the abolition of the pension for long-term insured, the pension commission delivers the results ordered by the Merz government: pension cuts.
Pellmann argued that the capital-funded component would make pension levels dependent on rising rents, care costs and the stock prices of arms companies, calling the entire set of measures unnecessary and unacceptable.
Union pushback
Trade unions and social associations also voiced strong reservations. IG Metall chief Christiane Benner warned that scrapping the deduction-free early pension after 45 insurance years would face fierce opposition in the metal and electrical industries, because 'these proposals ignore the working and living situation of many employees in our plants.' The German Social Association (SoVD) and the Verdi union likewise expressed disappointment with the direction of the commission's work.
Next steps
The black-red coalition under Chancellor Friedrich Merz aims to assemble a broad reform package by the summer recess that will cover the labour market, pensions, income tax and bureaucracy reduction. The commission's report will now feed into those negotiations, with strong positions on both sides suggesting a difficult legislative path.
