Germany moves to end early‑retirement pension at 63
A commission‑backed reform would close the 63‑year‑old early‑retirement option, sparking debate over costs, fairness and the country’s ageing workforce.
The coalition government in Germany is drafting legislation that would eliminate the "Rente mit 63", a pension option that lets workers retire at 63 with full benefits. The change follows a June expert‑commission report that recommends raising the statutory retirement age and widening compulsory contributions to include civil servants and the self‑employed.
Germany, like much of Europe, faces a shrinking labour pool as life expectancy rises and birth rates fall. Keeping the pension system solvent has become a political priority. The early‑retirement scheme costs roughly €3.5 billion a year, according to the German Pension Insurance Fund, because retirees draw benefits for longer while contributing for fewer years.
A study by DIW Berlin estimates that scrapping the scheme would save about €9.5 billion per pension cohort and could keep an extra 125,000 full‑time workers employed. Lower contribution rates, down 0.4 to 0.5 percentage points, would also ease the burden on current earners, according to Prognos.
Unions and opposition parties have condemned the proposal. Trade union Verdi called it a "total disregard for the lifetime achievements of the people concerned". Christiane Benner, national chair of the IG Metall union, defended the right to a full pension after 45 years of contributions, urging critics to visit a factory floor for perspective.
State premiers in the east, such as Dietmar Woidke of Brandenburg, also oppose the move, arguing that a 45‑year career should merit a pension without cuts. A poll by the Insa institute for Bild am Sonntag found 68 percent of respondents against ending the early‑retirement option, while only 24 percent support it.
Chancellor Friedrich Merz said the reforms must be implemented swiftly to "secure pensions and ensure that burdens are distributed fairly across all segments of society and across all generations".
The government will translate the commission’s recommendations into draft bills, which will be debated in the Bundestag before a final vote. Outside the parliament, the issue is expected to dominate public discourse and union negotiations in the coming months.
If the legislation passes, the retirement age for the full‑pension track will rise, and the separate 35‑year contribution pension will see its minimum age lifted from 63 to 64. The long‑term effect could be a more sustainable pension system, but the political cost may be high.