A fierce rebellion over pension reform is pushing Germany's coalition government to the brink, with a youth wing of the conservative party, led by chancellor Friedrich Merz, gaining significant traction in its bid to block legislation they claim will force younger Germans to shoulder an unsustainable financial burden for the older generation.
The Young Rebels Challenging the System
An 18-strong group of young MPs from the Junge Union has been accused of holding Merz's government to ransom. They are demanding a revision of proposed pension reforms that would guarantee pension increases for the next six years. Among the rebels is Johannes Volkmann, the 28-year-old grandson of former chancellor Helmut Kohl and an MP for Lahn-Dill.
Volkmann has become a vocal mouthpiece, arguing that his generation will be left "carrying the burden for retirees and prospective retirees." He states that Merz's proposals to lock in current pension levels would lead to additional costs of around €120bn until 2040, a sum he describes as "fiscally unsustainable" for younger workers.
A Looming Political and Economic Stalemate
The political stakes are exceptionally high. Chancellor Merz operates with a slim majority of just 12 in the 630-seat Bundestag. With the vote due in December, the rebellion threatens to cause a legislative stalemate. The number of MPs prepared to defy Merz could swell to between 40 and 50 if older, disgruntled colleagues join the cause.
Merz has dug in his heels, telling a Junge Union gathering that he would "vote in favour of this pension package with a clear conscience." He frames it as a necessary adjustment to Germany's welfare state. However, this stance is at odds with the demographic reality. Germany's population is ageing rapidly, exacerbating a system-wide problem.
The core issue is the shrinking worker-to-pensioner ratio:
- In the 1950s, there were as many as six workers for every pensioner.
- A few years ago, this had fallen to three.
- Now, there are only around two workers supporting every pensioner.
This demographic shift has driven compulsory pension contributions, split between employers and employees, to soar to almost 19% of salaries, with further increases anticipated under the current plan.
Generational Divide and the Search for Solutions
The young rebels propose a reduction of the pension level from 48% to 47% of the average salary, arguing it is a small sacrifice for the older generation to make to secure the system's future. Their concerns are reflected in public opinion polls, which show widespread lack of confidence across all age groups about future pension provision.
An increasing number of Germans expect to work beyond the official retirement age, which is gradually rising to 67. The government is being urged to launch campaigns promoting private pension investments, as currently, only 60% of Germans have additional financial sources for retirement.
While Volkmann has held talks with Merz, who reportedly acknowledged the group's demands "make sense," the chancellor's recent public comments cast doubt on any major concessions. The outcome of this clash will not only determine the fate of the pension package but could also stall Merz's broader reform agenda for Germany, including plans to incentivise retirees to continue working.
