News Pension contribution 2018 officially falls to 18.6 percent

News Pension contribution 2018 officially falls to 18.6 percent News always well informed

Monday, 23.10.17 , written by Anja Schlicht The good employment situation in Germany not only means that the average contribution to statutory health insurance will fall in the coming year. Employees will also be relieved of the pension contribution in 2018. Because the Federal Cabinet has now decided to adjust the contribution rate from 18.7 percent to 18.6 percent. >  Employees will be relieved of the pension contribution in 2018

  • The pension contribution will fall in 2018 to 18.6 percent.
  • The reason for this is bubbling revenues from rising wages and a strong increase in employment.
  • The contribution to the miners’ pension insurance also drops to 24.7 percent.

The pension contribution will fall in 2018. This was decided by the Federal Cabinet on 22 November. Because the improved employment situation and rising wages, the statutory pension insurance takes more money than expected . Already in the run-up, both the circle of annuities and the chairman of the board of the Deutsche Rentenversicherung, Alexander Gunkel, had thought it possible to lower the pension contribution by 0.1 percentage points to 18.6 percent.

Employees will pay only 9.3 percent of their gross income in the pension fund by 2018 instead of the previously 9.35 percent due to the lower pension contribution. The same applies to employers.

Originally it was planned to leave the contribution rate for statutory pension insurance unchanged at 18.7 percent until 2021. After that, an increase to 18.9 percent was planned. Now, the pension contribution should remain at 18.6 percent until 2022 and then gradually be adjusted to 21.6 percent by 2030.

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When will the pension contribution 2018 be adjusted?

By law, an adjustment of the pension contribution is provided if one of two conditions is met: If the reserves of the pension insurance at the end of the year at less than 0.2 monthly expenses, the contribution must be screwed up. However, if the so-called sustainability reserve exceeds the upper limit of 1.5 of the monthly expenditure, the contribution rate drops . According to the Federal Cabinet, the reserve currently amounts to 1.59 monthly expenses. By the end of 2017, it should be around 32.9 billion euros.

The lower pension contribution in 2018 not only relieves employees and employers slightly. The federal government could also reduce its subsidy to the pension fund by around 200 million euros. In addition, pensioners could benefit from a better pension adjustment in 2019.

In advance, it was speculated whether the government decides for a short-term contribution relief. Finally, the pension fund is under pressure not only because of expensive laws such as the mother’s pension and the pension at 63. Demographic change will also severely impact statutory pension insurance over the next few years. The better the reserves are handled, the sooner future increases in contributions can be absorbed.

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  • Anja Schlicht
  • editorial staff

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