Monday, June 1, 2020

Ulrike Schielke-Ziesing, May 15, 2020, Basic Pension


Ulrike Schielke-Ziesing
Basic Pension
German Bundestag, May 15, 2020, Plenarprotokoll 19/161, pp. 20032-20033

[Ulrike Schielke-Ziesing is an Alternative für Deutschland Bundestag member from the eastern German state of Mecklenburg-Vorpommern. She is a pensions administrator and a member of the Bundestag social security committee. Hubertus Heil (SPD) is German Minister for Labor and Social Affairs. Olaf Scholz (SPD) is German Minister for Finance.]

Right honorable ladies and gentlemen. Right honorable Frau President. Honorable citizens.

We members have long waited for this moment. We today actually debate the draft law on the basic pension [Grundrente]. For 14 months, very much energy was invested in the application of the Grundrente, and at least as much energy so as to finally convince the coalition partners. In the bill it is stated that the Grundrente honors a life’s work and shall guard against old age poverty.

At this point, it is fitting to ask why the insured, who have worked for at least 33 years and paid into the Pension Insurance, in the end receive so low a pension, which now must be funded. How did it come to such a state?

Decisive for the terribly low pensions are the reforms of recent years; for example, the introduction in 1998 of demographic factors and, before all, the Schröder-Riester reform of 2001. It may also be remembered that it was first with an SPD government that the low wage sector could be so expanded. The coalition partners have been responsible for the low pensions and now congratulate themselves for pitching a little on account of the Grundrente to the contributors. Way to go!

For months experts, from the Bertelsmann Foundation to the employers’ associations, from the German Pension Insurance to the OECD, have referred to serious defects. The Grundrente is not precisely oriented. It is socially unjust, much too expensive and thereby largely ineffective. Everyone knows that those especially directed to aid seldom attain the prescribed insurance years. The Grundrente is constitutionally suspect on account of its neglect of principles of equality. Besides that, the equivalence principle is not followed.

            Matthias W. Birkwald (Linke): Yes, and ?

How do you explain, Herr Heil, that the insured who pay the same contribution do not receive the same benefit from the Pension Insurance? Herr Heil, you are thereby creating new injustices in the insurance community.

Matthias W. Birkwald (Linke): Which have long been in the pension law. No one has ever denied that.

For the Pension Insurance, the Grundrente in terms of organization is not convertible within the time frame; for the Finance officials’ income inquiry, the required IT system is lacking. Millions of documents must examined by hand. The Pension Insurance requires approximately 3,400 additional employees to manage the examination of current pensions. For the current operation, especially on account of the regulated income testing, 1,600 employees must be shifted to the Grundrente. From where will these be taken? The Pension Insurance has already indicated it will not be able to convert to the Grundrente by the beginning of January 1, 2021 – and that was before Corona.

To directly aid the really poor pensioners, an allowance resolution [Freibetragslösung] for the pension with a charge on the old age basic security is the better assessment.

            Matthias W. Birkwald (Linke): But not yesterday’s thin thing, please!

Since February 2019, there has been before you our motion for conversion which we here yesterday in plenary session definitely moved. The conversion cost would be far less and the usage the same or even greater than with the Grundrente.

            Matthias W. Birkwald (Linke): No. Definitely not!

Further, this option would conform to the constitution and preserve the equivalence principle of the statutory Pension Insurance.

            Kerstin Tack (SPD): That is the hope principle! The coalition’s draft law is 
            much better!

Herr Minister Heil, it is exceedingly praiseworthy that you have partially taken up our proposal in your draft law.

            Hermann Gröhe (CDU/CSU): Painful!

Unfortunately, you reduce the range of the qualified by defining the admittance prerequisite as 35 insured years. All other pensioners, including pensioners incapable of earnings, again fall through the cracks, and that is not right.

We come to the costs of the Grundrente. As one presently reads, there will be no second or third reading of the Grundrente if the financing is not enacted, and that is appropriate. The financial requirement will amount to about 1.3 billion euros in the year 2021. It is positive that it will be clearly legislated that the cost will not be borne by the insurance community but shall be paid out of the tax revenues. Yet from where does this tax revenue come? Already before Corona, the finances stood on shaky ground. Minister Scholz wanted a financial transactions tax, the other EU countries not.

What does it look like now in the Corona crisis? To cushion the economic and social consequences of the crisis, we in the parliament have decided on a supplementary budget to the sum of around 156 billion euros. The Federal Institute for Labor, with its reserves, will not suffice. It is clear that an additional supplementary budget is coming. The income of the states in the next years will amount to far less than planned. The tax revenues of the Federal government will be lacking in this year alone a sum of around 40 billion euros.

And the pension, sickness and care insurance income will fall off, which then must be covered by the Federal government.

            Beate Müller-Gemmeke (Greens): What’s that mean now?

How, please, shall the Grundrente then be financed? Despite it all, Herr Heil, you are determined to put through this Grundrente. It may then be asked here, why do you thusly set your priorities?

            Dagmar Ziegler (SPD): We have done more!

Can it have something to do with the Federal elections taking place next year and the pensioners being a not to be underestimated group of voters?

            Kerstin Tack (SDP): It does not get more banal! Just a bit of this is about 
            the people!

To disperse election gifts shortly before an election, certainly all Labor Ministers do that. In this case, however, it will be a giant disillusionment for the voters if they are unable to actually note Grundrente in the purse.

Yesterday, Minister Scholz announced the largest tax deficit of all time. The total tax deficit to 2024 will amount to an inconceivable 315.9 billion euros, of which that of the Federal government will be around 171 billion euros. Nevertheless, Scholz says not a single project will be trimmed. Where the taxpayers’ union advises the examination of all government expenditures, Minister Scholz says, quote, “We can continue to do what we have undertaken.” Naturally, he thereby refers to the Grundrente. It is really just inconceivable how budget policy is being made here

            Kai Whittaker (CDU/CSU): Does that mean that you do not want to 
            do anything?

Beate Müller-Gemmeke (Greens): Why did you bring the motion yesterday, if you actually wanted to do nothing? Not the least empathy!

and how far from one another are pretense and reality.

With the SPD, nothing can be done [sind Hopfen und Malz verloren]. I want here however to appeal to the reason of the CDU/CSU members. Stop this nonsensical Grundrente! Do not allow a further, second reading here in the Bundestag.

Many thanks.

            Dagmar Ziegler (SPD): That really was nothing!

            Ulli Nissen (SPD): How I look forward to Hermann Gröhe!



[Translated by Todd Martin]