Creating financial plans - A citizen group cautions against using pension reserves for non-retirement purposes.
The group representing taxpayers in Baden-Württemberg has declared that they will not support any moves to decrease regular payments directed at the pension fund for government workers in order to pay for the upcoming 2025/26 dual budget. Eike Möller, the head of this German state's administration, has warned against drawing money from the fund while he spoke in Stuttgart, saying that such tactics are not aligned with financial stability. He added that the fund was established to lessen the future pension burden and that withdrawing money would put a burden on future generations, also lowering people's confidence in the government.
The Ministry of Finance, when inquired about this issue, didn't offer up any remarks.
Since 2009, the state has been systematically storing money to cover a rising number of pensioners. 725 million euros were added in 2023, with 768 million euros added in the current year. At the end of the last year, the fund holding pension assets amounted to 11.4 billion euros. On the other hand, there were roughly 151,000 pension recipients in the region.In favor of bringing a sustainability factor into pensions, Möller suggested considering a system where pension increases are adjusted based on a ratio of contributors to pension recipients. This speaks to the ratio of taxpayers and pension recipients.
Hanna Binder, the deputy head of the state Verdi Trade Union, suggested that the state government can truly add more money to the system if they got rid of the debt brake. Binder stated that pensions are legally secured, and reducing their burden on state budgets wouldn't result from such calculations. "The green-black coalition in Baden-Württemberg has been able to afford everything with abundant sources of tax revenue for years. But now they must make savings by resorting to trickery involving the pension fund. Lowering the payments into the pension fund will incur additional debt as burdens are passed off to the future."
The taxpayers' association views other measures that could result in savings, such as decreasing building standards in constructing buildings owned by the state, reviewing the reactivation of disused railway lines, or not continuing the construction of bike trails where alternative routes already exist. Moreover, Möller recommended that the state should restrain itself when appointing experts and cut back on image campaigns.
To achieve sustainable savings in the budget, Möller proposed having fewer ministries. Combining departments during this present legislature could be an issue. Despite a small increase in expected tax revenue, the Ministry of Finance anticipates a budget shortfall of at least 2.5 billion euros while drafting the new budget.
This assessment from the taxpayers' association is essential in influencing the deliberations on the 2025/26 dual budget for Baden-Württemberg's Green-Black coalition, who intend to form this year. Despite this slight increase in tax revenue, the Ministry of Finance predicts a budget gap of least 2.5 billion euros will need to be filled when the new budget is created.
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Source: www.stern.de
