The recent pension increase, set by the Federal Ministry of Labor in March 2025 and confirmed by the Cabinet in May following the collapse of the coalition between the SPD and Greens, will take effect on July 1, 2025.

The Bundesrat has approved a pension increase of 3.74%, translating to an additional 66 euros per month for standard pensions based on average earnings and 45 years of contributions.

For those with pensions of 1,000 euros, the increase will amount to 37.40 euros, while recipients of 1,200 euros will see an increase of 44.88 euros, and those at the average pension level of 1,500 euros will receive 56.10 euros more.

The new pension rate of 40.79 euros per entitlement point results in a monthly increase of 66.15 euros for standard pensions based on average earnings.

This increase surpasses the current inflation rate of approximately 2%, highlighting its significance for retirees, as noted by Manuela Schwesig, the Minister-President of Mecklenburg-Vorpommern.

Schwesig emphasized the importance of pension stability and expressed concerns about ongoing proposals that could destabilize public confidence in the pension system.

Currently, the pension level is guaranteed at 48% of the average salary, but this security is only assured for 2025, with future developments remaining uncertain after 2031.

Engelmeier stressed the need for the government to stabilize the pension level sustainably at 48% to avoid stagnation in pension increases.

While the increase is welcomed by social organizations, Michaela Engelmeier, chairwoman of the Sozialverband Deutschland (SoVD), considers it insufficient for those with very low pensions.

Currently, 3.4 million retirees live below the poverty risk threshold, with women particularly affected due to traditional roles that limit their contributions to the pension system.

In East Germany, where 97% of retirees rely solely on statutory pensions, every euro is critical for their financial stability, as private pensions and rental income are rare.

Despite over 70% of the population trusting the pension system, only 20% believe in the adequacy of future pensions, with concerns about old-age poverty particularly affecting women.