Funds get a new lease of life

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German basic pension raises questions of financial sustainability

first_img“We have never been able to afford the basic pension,” the spokesperson said, adding that funds for the measure are based on EU financial transaction tax that will never exist.A national debate has erupted yet again after, on May 15, the German parliament reviewed in the first reading a draft law for the introduction of the Grundrente for long-term insurance in the statutory pension, based on a gorvernment proposal.The coalition partners, consisting of the SPD, CDU and CSU parties, included the basic pension in a contract to support Angela Merkel’s government in 2018, reviewed last November, but still a source of doubts on essential points.The SPD originally required that the income would not play a role to assess whether a person had the right to a basic pension, while the Union (CDU/CSU) asked to take into account not only their income but also their entire financial situation.The pension expert for the CDU/CSU parliamentary group, Peter Weiß, now believes that a basic pension will start in 2021, but one condition, he said, is a solid financing concept.The government intends to present various financing models, including a European financial transaction tax, but “we lack a binding, clear statement of where and when this money is available. This is a basic requirement for the Union. The financial concept must also be in place if we give the final consultation (on the law) in the parliament,” he explained.Under the new scheme, additional pension will be paid to anyone who has at least 33 years of contributions to the statutory pension insurance based on periods of employment, child-rearing or care work.The basic pension is calculated in steps, from 33 to 35 years of contribution to ensure that also below 35 years additional payment is provided, according to the legislator.The Grundrente is guaranteed after assessing that single earners own a maximum monthly income of €1,250, or €15,000 per year, and €1,950 per month (€ 23,400 per year), for married couples or partners.The parliamentary commission labour and social affairs” will hold a hearing on the draft law on May 25. The Deutsche Rentenversicherung (DRV), the administrator of the state pension scheme, has submitted a series of proposals to streamline the financial and bureaucratic processes to grant a basic pension.In a statement, the DRV had considered an “enormous challenge” assessing the requirements for granting a pension. For the first time, pensions must be retrospectively examined and, if necessary, insurance biographies upgraded.The authority foresees July 2021 as the earliest date possible for the payment of the additional pensions because the IT architecture has to be adjusted in a highly complex pension system, and the 26 million already existing pensions can only be processed by the end of 2022.The DRV thinks it is possible that the basic pension is financed with taxes, but “parameters” for financing the measure in the new rules have not been determined exactly.An increase of the federal subsidy may not be sufficient in the long run to cover the additional expenses for pension insurances.The DRV, therefore, supports a reimbursement scheme that would also take into account additional administrative and procedural costs. Reimbursements are made, for example, by the federal government in the context of the Claim and Benefit Transfer Act (AAÜG) or by the Federal Employment Agency for reduction of earning capacity.The spokesperson for Gesamtmetall said: “The basic pension creates new injustices. Everyone involved would be well advised to forego the basic pension.”To read the digital edition of IPE’s latest magazine click here. The introduction of a basic pension in Germany – or Grundrente – has been raising pressing questions over its long-term financial sustainability.“Pension policy decisions will cost money for decades to come and the basic pension will not help against old-age poverty,” a spokesperson for Gesamtmetall, the organisation representing companies in the metal and electrical engineering sector, told IPE.According to Gesamtmetall, the costs to provide a basic pension are “enormous”, with €400m in administrative expenses to calculate in 2021 alone for a pension insurance pot of €1.3bn.A total of around 1.3 million people will benefit from the basic pension from 2021, including 70% of women.last_img read more

Nightly lane closures planned this week on I-74 between S.R. 101 and Ohio state line

first_imgDearborn County—INDOT contractor John R. Jurgensen Company will continue patching work this week for the $20.3 million asphalt resurfacing project on I-74 in Dearborn County that began last month.Nightly lane closures begin tonight through Wednesday for patching and repair operations in both east and westbound lanes from S.R. 101 to the Ohio state line. Closures will begin at 9 p.m. each evening and will be removed by 5 a.m. the next morning.Monday, September 23 (tonight, 9 p.m. to 5 a.m.):WB left lane closed between MM 164 to MM 160WB left lane closure extended from MM 160 to MM 156 (adjacent to current I-74 reconstruction project)EB left lane closure extended from MM 156 to MM 160 (adjacent to current I-74 reconstruction project)Tuesday, September 24 (9 p.m. to 5 a.m.):WB right lane closure extended from MM 160 to MM 156 (adjacent to current I-74 reconstruction project)EB right lane closure extended from MM 156 to MM 160 (adjacent to current I-74 reconstruction project)EB right lane closed between MM 160 to MM 164WB left lane closed from the Ohio state line to MM 169Wednesday, September 25:Various lane closures from S.R. 101 to Ohio state line, areas not yet patched/repaired on Monday or TuesdayThe contractor is utilizing a queue-detection system with four sensors and a portable message board to notify westbound I-74 traffic entering Indiana from Ohio of slowed or stopped traffic ahead.Travelers are urged to slow down and exercise caution in and near the work zone.Patching will be complete later this fall. Milling and paving is scheduled to begin in July 2020. All work is weather dependent.last_img read more