As of July pensions are set to rise in Germany, by 3.45% in the west of the country and by 4.2% in the east. A standard pension will then be 1,538.55 euros a month in the west (51.37 euros up on the previous year) and 1,495.35 euros in the east (an increase of 60.30 euros).

The gap between pensions in east and west closes further

This year, the scheme adopted by law in 2017 to close the gap in pensions in the east and west comes into effect for the third time. The level of pensions (in the east) will be increased such that it is equivalent to at least the legally stipulated 97.2% of the western figure.

The standard pension is a regular old age pension that an average earner would receive after paying into the statutory pension scheme for 45 years. Since the biographies of insured individuals vary enormously, this fictitious pension is taken as a measure for all pensions when calculating adjustments to pensions.

Good labour market and rising wages

The rise in pensions has been made possible by positive trends on the labour market and rising wages over the last few years. In 2019 wages in the west increased by 3.28% in comparison to 2018, while the figure in the east was 3.83%.

Pensions for farmers too will rise. As of 1 July 2020, the general unit value (in the west) used to calculate the pensions of retired farmers will be 15.79 euros, while the figure in the east will be 15.32 euros. Benefits for those entitled to other pensions, including victims of war and military service as well as individuals sustaining vaccination damage and victims of violence, will also increase. These pensions will rise by 3.45% as of 1 July 2020.