"Finance Minister Lars Klingbeil called the reform a 'real milestone' and a 'game changer,' stating it strengthens the third pillar of pensions alongside statutory and occupational schemes."
"Changes agreed in parliament make private retirement savings more attractive for low-income earners and families, with saving now paying off 'from the first euro' and reduced costs."
"The SPD-CDU/CSU coalition approved the reform, which will effectively phase out new Riester contracts, while the Left Party voted against and the Greens and far-right AfD abstained."
"Klingbeil also mentioned plans for a 'starter pension,' under which the state would contribute about 10 euros per month into retirement accounts for children and young people."
Germany's parliament has voted to replace the Riester pension system with a new state-backed savings model. The Riester system has been unpopular due to low returns and complexity. The reform aims to simplify saving, reduce costs, and enhance profitability, especially for low-income earners and families. Finance Minister Lars Klingbeil described the reform as a significant milestone. The new model will phase out Riester contracts, expand eligibility to self-employed workers, and increase state subsidies. Plans for a starter pension for children and young people are also forthcoming.
Read at www.dw.com
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