Merz government plans new ban – it will affect numerous recipients
Germany’s pension debate is heating up as the Merz government prepares a major retirement reform that could significantly affect people receiving a partial pension (Teilrente). One proposal could put an end to a strategy many retirees currently use to increase their future pension payments.
Under Germany’s current system, people can choose to receive only part of their pension—often 99.99 percent instead of the full amount—while continuing to work. By remaining on a partial pension, they continue paying into the statutory pension system and can earn additional pension points, which may increase their future monthly pension. The option has become especially popular among older workers and family caregivers.
According to reports, the Merz government is considering ending this practice as part of a broader overhaul of Germany's pension system. Critics argue that the current arrangement has become a legal loophole that allows some retirees to boost their retirement income beyond what was originally intended. Supporters, however, say the rule rewards people who continue working or provide unpaid care for relatives while technically remaining in retirement.
The planned changes are part of a much larger pension reform package aimed at making Germany’s retirement system financially sustainable. The Pension Commission (Alterssicherungskommission) has proposed dozens of measures, including a stronger focus on capital-funded pensions, changes linked to life expectancy, and incentives for people to remain in the workforce longer. Chancellor Friedrich Merz has already announced that his government intends to implement the commission’s recommendations as a complete package rather than selecting individual measures.
For now, no final law has been passed, meaning the existing rules remain in force. Retirees can still choose a partial pension under the current regulations, but the government’s reform plans suggest that this option may become much more limited in the future. If the proposals are approved by parliament, thousands of people who planned to use this retirement strategy could be forced to rethink their financial plans.