– Update 27/08/2023 18:42
News from Germany – Pensioners are entitled to inflation compensation. High inflation is putting enormous financial pressure on German households. Low income groups are particularly affected. Therefore, inflation adjustment would be desirable for pensioners. But was it planned? It is already known whether pensioners will receive 3,000 euros from the state.
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Pensioners are entitled to inflation compensation
The staff breathed a sigh of relief as they were called. Inflation premium, pensioners in Germany are also waiting for a lump sum payment or a public subsidy. RUHR24 reports that for employees, the legislator offers up to 3,000 euros as a bonus.
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“This is a voluntary benefit provided by employers,” says the federal government. Payment till end of 2024 […] It is possible without tax and social security contributions,” he continues. Adequate inflationary compensation is now planned for pensioners as well. According to MDR, this is due to a recent collective agreement in the public sector.
The draft law of the Federal Ministry of the Interior and the Interior states: “Pensioners will receive a payment within the meaning of § 3 No. 11c of the Income Tax Act (EStG) in 2023, i.e. a one-time payment of € 1,240 in June 2023, depending on the relevant pension rate and share and monthly amount €220 for the months July 2023 to February 2024, depending on the relevant pension rate and share.
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21 million retirees are left empty-handed
As the Bild-Zeitung reports, this means particularly for pensioners: “The longer a civil servant works, the higher his pension rate – a maximum of 71.75%. So a pensioner at the maximum rate will receive a total tax-free bonus of €2,152.50.’
About 21 million “average” retirees are not entitled to inflationary compensation because they were not government employees during their careers. The social association VdK has criticized this unequal treatment.
Although statutory pensions will be increased by 4.39% in the West and 5.86% in the new federal states from July 1, 2023, according to the VdK, this is not a political concession. According to the VdK: “The basis for the indexation of pensions is social law. It results in the right to an annual review – that is the legal position.”
Pensioners suffer from higher inflation premiums
The most important factor in the growth of statutory pensions is the growth of previous wages. According to the VdK, the schedule of pensions cannot be offset against the inflation premium.
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The lack of compensation for inflation amounts to a huge disappointment for pensioners. Especially since food is currently the strongest factor affecting prices. “After +14.9% in May 2023, food prices increased by 13.7% in June 2023 compared to the same month of the previous year, making food a strong price driver in the food sector,” the Central Bureau of Statistics said.
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