German Pension Reform Links Retirement Age to Life Expectancy, Praised by Austria's NEOS

German Chancellor Friedrich Merz announced that the government will fully implement the pension commission’s proposals. The plan raises the statutory retirement age to 67 by 2031 and will thereafter be tied to life expectancy, mirroring the Swedish model. It also eliminates the “Rente ab 63” early‑retirement option, expects higher contribution rates and will earmark part of net wages for a state‑managed supplementary pension invested in securities.

Austrian NEOS social spokesperson Johannes Gasser welcomed the German draft, calling an “open debate about further pension reform … no taboo” and saying the linkage to life expectancy is “the successful example of the Swedes”. The Austrian Industrial Association echoed the praise, supporting NEOS’s call for a similar open discussion in Austria.

The reform is expected to increase future pension costs for employees and employers, while aiming to secure long‑term pension sustainability.