The Ifo Institute condemns the German government's pension policy as "fatal."
The Ifo Institute criticizes the federal government for their "fatal pension policy." With the demographic pressure in mind, the current pension rate of 48 percent and the elimination of the sustainability aspect is unrealistic, noted Ifo researcher Niklas Potrafke in Munich. "As more and more young people take care of fewer and fewer elderly, pensions need to increase at a much slower rate in Germany."
The government's pension plan requires additional tax subsidies for pension funds, which are essential for investments in infrastructure, education, and defense. On the other hand, what's really needed is an adjustment of the retirement age to match life expectancy.
As the population continues to age, the retirement age must also be pushed back. The public and politicians have been ignoring these realities for quite some time.
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