Social policy | Pension injustice in the East hardly alleviated

A hardship fund set up by the federal government, intended, among other things, to alleviate pension injustice in East Germany, has helped only a very small number of those affected. Only 2,734 members of certain professional groups, some of whose pension entitlements acquired in the GDR had been disregarded after reunification, received a rather symbolic one-off payment of €2,500 from the Federal Republic. In Thuringia and Mecklenburg-Western Pomerania, the amount doubled because the federal states joined the fund. The other eastern states refused .

At the same time, the €500 million approved for the fund remains far from being fully utilized. Only a total of €162.54 million in payments has been approved. The remaining €337 million will be returned to the federal budget.

The Hardship Fund was established in November 2022 by the then federal government, consisting of the SPD, the Greens, and the FDP. A foundation was established to administer it, with a limited term of three years. This was preceded by years of wrangling between the federal and state governments. Since January 2023, those affected have been able to apply for a lump-sum one-time payment to "mitigate perceived hardships." In addition to pensioners from the eastern part of the country, this also included ethnic German repatriates and Jewish quota refugees from the former Soviet Union. The application deadline ended in January 2024. By the end of June, the foundation had processed 99.97 percent of the applications.

A total of almost 169,000 people applied for compensation. The federal government had estimated the number of people with legitimate claims at up to 190,000 , including 50,000 to 70,000 East German pensioners alone. Of the applications submitted, just one-third (57,030) were approved. This is according to figures requested from the foundation by the Left Party parliamentary group in the state parliament of Saxony-Anhalt. Of the approvals, 38,448 went to quota refugees and 15,848 to ethnic German repatriates. They will receive a total of 108.8 and 44.2 million euros respectively, while pensioners from the East will receive 9.49 million. This is 5.8 percent of the funds distributed and less than two percent of the total money made available in the fund.

This means that only a fraction of those affected will receive even a small amount of compensation. In Saxony-Anhalt alone, where 436 applications were approved, the state government had estimated the number of potentially affected people at more than 13,300. The largest total payments, just over six million euros, were made to women divorced in the GDR. Almost one and a half million euros went to former healthcare workers, 1.1 million to employees of the German Reichsbahn, 550,000 euros to employees of the German Post Office, 22,500 euros to ballet dancers, and 10,000 euros to miners. In Saxony, for example, only three former miners received a payment.

"This is yet another disregard for East German achievements."

Susanne Schaper, Left Party Leader Saxony

Problems with the harmonization of pension systems in East and West Germany during German reunification had arisen for almost 20 professional groups, as well as for divorced women, who were disadvantaged because, unlike women in the West, they received no pension adjustment. The long and unsuccessful struggle of those affected usually led through numerous legal instances and, in the case of divorced women, all the way to the UN. The issue also received little attention in federal politics for a long time. Saxony's Minister of Social Affairs, Petra Köpping (SPD), admitted years ago that some of those affected were "deeply offended by this, some even angry and felt unfair."

The hardship fund's performance is likely to reinforce such feelings. "'Meager' is an understatement," said Susanne Schaper, leader of the Left Party parliamentary group in Saxony, and criticized the regulations according to which only those receiving a pension up to the level of basic social security were eligible to apply. Schaper spoke of a "further disregard for East German life achievements." Monika Hohmann, social expert for the Left Party in the state parliament of Saxony-Anhalt, called it a "flop" and a "humiliation" for East German pensioners. She demanded that the €337 million that had not been allocated be used for further compensation payments. A "Round Table on Pension Injustice," in which many affected groups participate, had already written to Chancellor Friedrich Merz (CDU) in June, demanding that a pension commission planned under the coalition agreement also negotiate a justice fund to "eliminate this injustice."