The German occupational pensions industry and politicians have reacted with disappointment to the decision of the country’s biggest union, IG Metall, to reject the social partner model for pension, but are playing it down, convinced that the model will continue gain traction.
“The decision of IG Metall is regrettable, given the efforts in the southwest of the country,” state secretary Rolf Schmachtenberg said during the Handelsblatt occupational conference referring to negotiations between unions and employers in Baden-Württemberg.
The government will continue to rely on the social partner model to further strengthen the second pillar occupational pension system, as also mentioned in the government coalition programme, he added.
For George Thumes, chair of the management board of the occupational pension association aba, IG Metall’s decision isn’t an attack on the social partner model that is not dead.
The fact that the social partner model removes employers’ liability (pay and forget) is key to convince other employers to offer and contribute to occupational pensions, he said during the conference earlier this week.
Kerstin Schminke, managing director of MetallRente, the pension scheme of social partners IG Metall and Gesamtmetall, underlined that the union continues to support company pensions under social partnerships, even though specifically rejected the social partner model.
She said MetallRente is a successful pension fund with more than a million occupational pension contracts, adding that the social partner model would be an addition to other forms of occupational pensions.
Explaining to employees the social partner model is a challenge, and discussing stability, security and the trust in both the first and second pillar pension systems matters to savers, she explained.
Christian Remke, member of the management board of the Metzler Sozialpartner Pensionsfonds, the vehicle used by Ver.di and Uniper, said IG Metall’s decision makes them “a bit angry”.
The Metzler pension fund has conducted a study which found that the security buffer financed by employer’s contribution for pure defined contributions (DC) under the social partner model is alone enough to fend off the impact of market fluctuations on pensions.
Uniper has sent a proposal to switch to pure DC plans for 4,000 employees in April, and 33% said to be ready to change plans, mostly in the age groups 40-49 and 50-59, according to Remke’s presentation.
Christian Pauly, manager of Metzler Sozialpartner Pensionsfonds, added that opening up the social partner to parties not bound by collective bargaining agreements through a second law to strengthen occupational pensions (Betriebsrentenstärkungsgesetz 2024), is an opportunity for employers and employees, including those in the metal and electric industry, that now see the doors of opportunity closed following IG Metall’s decision.
Further social partner models might start in the financial, glass and paper industries, and for professionals, following the one agreed between Ver.di and Uniper and in the chemicals industry.