GERMANY - Despite being told their state pensions would be frozen until 2009, 20 million German pensioners are set to receive an increase of 0.54% to their monthly income on 1 July.
The approval for the increase was confirmed by ministers yesterday in Berlin.
Government liabilities would rise by €1.2bn to cover the increased payment, but this would be funded by an economic upturn and lower unemployment, according to the labour ministry.
The country’s unemployment rate fell from 9.3% to a six-year low of 9.2% in March, increasing tax revenues which bolstered social service funds.
In March union members within the German Federation (DGB) protested when a law was passed by the lower house raising the retirement age from 65 to 67.
If passed by the upper house, the retirement age would gradually rise from 2012 until reaching the new agreed level in 2029.
Pension freedoms could generate as much as £1.9bn a year in tax revenue for the next 10 years, according to research by the Pensions Policy Institute (PPI).
The Pension Protection Fund (PPF) has conceded it does not have "all the data we need to calculate" the impact of last month's ruling that some benefits may be unlawful.
A looming court decision on gender equalisation of pension schemes could hit FTSE 100 profits by up to £15bn, Lane Clark and Peacock (LCP) says.
Dutch custodian KAS Bank has created a fintech solution to help schemes save on costs and improve transparency of currency hedging strategies.