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German province to discontinue MP fund

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  • German province to discontinue MP fund

GERMANY - The German province of Saxony is thinking to discontinue a pension fund set up for regional MPs due to its inefficiency.

In 2007, the local government coalition between Conservatives (CDU) and Social Democrats (SPD) decided to set up a pension fund for members of the regional parliament joining after January 2009.

Now, however, the CDU - which is no longer part of the local government - and the other opposition party, the centre-right FDP, have filed a motion to discontinue the fund.

In a motion, the parties said: "The pension fund for MPs can objectively be seen as not fit for purpose given the low number of members."

Instead, the local government is to pay each member a certain monthly sum based on an index linked to the province's economic performance.

The MPs will then be able to choose whether they want to put the money into the state pension system, an occupational pension fund or a supplementary private retirement plan.

A spokesman for the local government confirmed to IPE the measure would not affect the pension fund for civil servants the province set up in 2005, similar to schemes in other provinces (see earlier IPE-story: German province to top up public fund with €114m ).
 

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