Federal Audit Office warns pension reforms could heavily strain Germany's budget

The Federal Court of Auditors has issued a warning that the government's planned pension reforms could place a heavy burden on the federal budget, potentially absorbing a large share of tax receipts by the end of the 2030s. The audit report highlights the expansion of the mothers' pension and the fixation of the pension level as the primary cost drivers. It stresses that one outlet 2025 budget totals around 488 billion euros, underscoring the scale of the challenge.

The auditors recommend that the government keep a close eye on the fiscal impact and take steps to curb it. The coalition's joint committee has scheduled the implementation of all 33 recommendations from the pension commission, aiming to complete the legislative process before the close of 2026, although coalition infighting casts doubt on meeting that timeline.