Author: Dr. Anette Reil-Held/Location: Mannheim

The raising of the retirement age can be regarded as an adequate reaction to the increase of life expectancy, which leads to longer periods of pension receipt and results in a considerable financial strain for the statutory pension system. The raising of the retirement age con-tributes to a stabilization of the contribution rate and is macroeconomically reasonable, because it dampens the decline of the employment rate. However, the exceptional rule for longtime insured persons is not appropriate, because it violates the equivalence principle and leads to problematic distributional effects. The provision benefits men and insured with higher-than-average pension entitlements. Another unwanted distributive effect of the clause, which can be intensified by the raising of the retirement age, affects insured with lower income, because they have – on average – a lower expectation of life and, consequently, a shortened perpetuity period. However, the statutory pension scheme is part of the social se-curity system and not geared to a differentiation with respect to individual risks. Therefore it cannot balance the mentioned effects. The dynamization of the raising of the retirement age could be the next step to limit the expansion of the period of pension receipt. This would prevent a resurgance of the discussion about the raising of the retirement age and contribute to the longterm stability of the statutory pension scheme.

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