Bert Rürup

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Episode 6: Bert Rürup meets some of Germany´s pensioners

Bert Rürup is one of the best known economists in Germany thanks to his proposals to reform the country's pension system. He is also one of the most controversial. The government in Berlin recently suggested raising the age at which a person can draw at pension from 65 to sixty-seven. Rürup made the same proposal years ago. He analysed the health of Germany's public pension system as well as demographic statistics and discovered that pension reserves are shrinking at the same time as pensioners are living longer. He suggested people save more money towards their pension. His recent proposal to cut the widow's pension caused discontent. We decided to bring Rürup and the people together - with today's pensioners and the pensioners of the future. He met senior citizens who are coping with less money and young people who can expect to work longer to receive a smaller pension.

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The elderly want to keep collecting their pensions for a long time, but coffers of state retirement funds are empty. Bert Rürup is used to tackling highly controversial issues.

Bert Rürup, TU Darmstadt: "People often talk about a demographic time-bomb. Bombs tend to explode with a loud bang..."

One scenario the professor regularly presents: people paying less into the pension funds and taking less money out. That doesn't make him popular either with the current generation of pensioners, who are worried their income won't be increased, or with future pensioners who are being asked to work until later in life. We confronted the pension specialist with people his decisions affect.

The scene is a gym in Darmstadt. This is where he meets people who looked forward to a long life on a good pension. Virtually everyone from the seniors' sport group is there. They want to see the leading government financial advisor work up a sweat. Many of them blame Rürup for cuts and pay freezes and want him to listen to their complaints.

Arno"...if I compare my pension income for 2003 and 2004, I'm down the equivalent of a whole month's rent."

Bert Rürup: "That's right. We haven't put up the pensions. But you must also have noticed that workers haven't had salary or pay rises either."

Angry partcipant: "We worked 40 years for this. I mean it's money which we paid in."

Bert Rürup, TU-Darmstadt: "That's correct. But the contributions which you made paid for your parents' pensions. You paid for your parents' pensions. And your children are now paying for yours. Which means you never paid for yourselves."

In an attempt to pacify the senior citizens, he tried turning on the charm.

Bert Rürup: "I'm amazed that you're so fit."

Arno: "That way we annoy the state..."

Rürup doesn't understand the pensioners' complaints. He has far more sympathy with those now aged from 35 to 45.

Bert Rürup: "Not only can they expect to receive back far less than you do and, on top of this, they'll have to make constantly increasing contributions."

The professor's effort pays some dividends. These women say they always got angry when they've heard Rürup on TV but now they say they think he's very sympathetic. He may have wrapped some of them round his fingers, but others still need to be convinced. Particularly future pensioners like nurse Dorothee Pacht. Because the 38-year-old is in the group which will eventually be hit hardest.

Dorothee Pacht: "We're making a soda-cake with water."

Resident: "Why not a beer cake?"

Bert Rürup: ".. you still have to add oil to a soda cake."

The nurse is going to have to pay more in... but will get less out, which needs explaining.

Bert Rürup: "You will live much longer than the people you're in charge of. And if people live longer, they'll need pensions for longer, and somebody will have to pay for them."

He makes the truth sound like a promise that she will share in the pension system. And what is Rürup's personal situation?

Bert Rürup: "I'm a civil servant so I'll get a good pension."

Resident: "Can I ask you something? Do you have private means?"

Bert Rürup: "Yes, I have been saving, so I have my savings."

He'll be well looked after, which may make it easier to ask other people to tighten their belts.

Bert Rürup: "Rürup was probably a rabble-rouser in the 13th century or so. That's where the genealogists say the name comes from. So many thanks."

Resident: "And these days you're still a bit of a rabble-rouser."

Bert Rürup: "A little."

The pension specialist is already on his way to his next appointment: a conference asking whether Germany can still afford its health insurance system...