The future of the Mütterrente in Germany, a key pension subsidy for mothers in Germany, is uncertain amid ongoing budget negotiations. A recent study reveals that its abolition could significantly worsen the financial situation for millions of elderly women.
Debate over Mütterrente: Budget negotiations continue
The fate of the Mütterrente (maternity pension) remains undecided as Germany’s coalition government faces budgetary challenges. Just five and a half weeks ago, the leaders of the Ampel coalition—Chancellor Olaf Scholz, Finance Minister Christian Lindner, and Vice Chancellor Robert Habeck—announced a new budget. However, a €5 billion funding gap has emerged, prompting renewed negotiations. While the discussions have shifted to video calls and phone diplomacy, one potential outcome could be the elimination of the Mütterrente. The Free Democratic Party (FDP) has advocated for this subsidy’s removal as a cost-saving measure. Recent talks have also included proposed cuts to pensions, notably affecting early retirement options and the Mütterrente itself.
Impact on retirees: Study reveals financial consequences
According to a recent study by the German Institute for Economic Research (DIW), the elimination of the Mütterrente would have serious implications for retirees. In 2022, nearly nine million women—86.5% of all women over 65—benefited from this subsidy. For these women, the Mütterrente added approximately €107 gross per month to their pensions. The DIW study highlights that the Mütterrente primarily supports women with middle and low incomes, who are particularly vulnerable to old-age poverty. The risk of poverty among women over 65 stands at 19.4%, compared to 16.2% for older men. Without the Mütterrente, this poverty rate for elderly women could rise to 22.3%.
Senior citizens’ organizations oppose removal
The Senior Citizens’ Union has strongly opposed the potential removal of the Mütterrente. They argue that especially women with small pensions would be severely impacted, leading to a lasting deterioration in their financial stability. The union emphasizes that the Mütterrente, introduced by the CDU/CSU, was a crucial measure to recognize child-rearing periods in pension calculations. They assert that it is not a separate pension category but an essential adjustment to account for child-rearing time. Despite reforms under Mütterrente I and II, full equity has not been achieved. The Senior Citizens’ Union remains firmly against the FDP’s proposal to abolish this important subsidy.
:max_bytes(150000):strip_icc()/GettyImages-1366789204-396675781d334e3185f26f740fb19995.jpg?w=350&resize=350,250&ssl=1 "Parents in Germany can boost retirement with child-rearing credits")
