Heads of government from the East German states are opposing the abolition of the 'Rente mit 63' pension scheme, which allows for retirement at age 63.
Three East German prime ministers from the Christian Democratic Union (CDU)—Kretschmer, Schulze, and Voigt—are demanding that the 'Rente mit 63' scheme be retained.
In a pension paper, Kretschmer, Schulze, and Voigt argue that while a proper hardship regulation is necessary, it must be addressed in the fine print.
Political divisions over reform
The German federal Christian Democratic Union (CDU) is blocking the proposal made by the three East German prime ministers to keep the scheme.
The German Social Democratic Party (SPD) said it would not oppose retaining the 'Rente mit 63' pension scheme, provided the three East German CDU politicians can convince the rest of their own party.
German Chancellor Merz stated that the pension proposals should be fully implemented.
Economic and regulatory context
The abolition of the penalty-free early retirement scheme is planned because it represents one of the largest savings potentials in the proposed German pension reform.
A larger percentage of East Germans reach the required contribution years for the 'Rente mit 63' scheme than West Germans, though the difference is shrinking.
Hardship regulation proposals
The German government's pension commission has proposed a hardship regulation. Under this plan, individuals with medical certification could retire without penalties two years before the standard retirement age with 35 contribution years instead of 45.
The commission has left the specific design of this hardship regulation to the legislative process.
