Germany set for bumper pension hike amid inflation surge
German Chancellor Olaf Scholz’s coalition Cabinet on Wednesday gave the green light to the largest hike in pensions in more than a generation.
The decision was made against a backdrop of rampant inflation, with pensions in Germany adjusted each year based on the national average salary.
It also comes after some pensioners received no increase last year as the coronavirus pandemic battered the economy.
How big is the increase?
Pensions in states that made up the former West Germany, where there was no increase last year, are to receive an increase of 5.35% from July 1 — the biggest hike for the region since 1983.
In the former states of East Germany, where there was a slight rise of 0.72% pensions in 2021, pensions will rise by 6.12%. That represents the highest increase since 1994, some four years after German reunification.
“The statutory pension is working very well despite the challenges we are currently facing,” said German Labor Minister Hubertus Heil.
“These are the largest pension increases for about 30 years,” he said.
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