German Chancellor’s Pension Bill Passes Amid Internal Strife
On December 5, 2025, German Chancellor Friedrich Merz managed to avoid a governmental crisis by securing an absolute majority for a pension bill in the Bundestag. However, this victory came amidst a noticeable revolt within his own conservative party, revealing some weaknesses in his leadership.
The pension bill, which is projected to increase spending by about 185 billion euros over the next 15 years, was passed with 318 votes in a parliament consisting of 630 members. Notably, it did so without any last-minute deals with left-wing opposition parties.
Yet, the passage of the bill was uncertain for most of the decision-making process, underscoring Merz’s lack of control over a coalition that includes both conservative and center-left Social Democratic Party (SPD) members, just seven months into his term. This political unrest raises questions about the coalition’s capacity to enact essential reforms that could address the economic downturn facing Germany, which is the largest economy in Europe.
These internal difficulties have led to a rise in support for the right-wing Alternative for Germany (AfD), which is now leading national opinion polls and is expected to gain ground in the upcoming state elections next year.
“The prime minister is, in a sense, a weak winner today,” commented political scientist Johannes Hillier. “The discussion has highlighted the limits of his leadership. It’s quite challenging to govern decisively under such conditions.”
According to the parliamentary vote results, seven conservatives voted against the bill while two opted to abstain—an unusually high number for Merz’s party. The legislation aims to maintain pensions at 48% of average wages until 2031 rather than reducing them, an agreement formed during coalition talks in May and especially significant for the SPD.
Some conservative groups opposed the bill, arguing it perpetuates an unsustainable financial system for younger generations. There was palpable tension until the last moment, with doubts regarding whether the coalition could garner the necessary votes, especially given its slim 12-vote majority.
Interestingly, the opposition Far Left offered to abstain right before the vote, inadvertently aiding the coalition by lowering the vote count needed to pass the package.
Pension-related issues and intergenerational equity continue to stir debate across Europe as populations age while financial pressures mount. Economists have criticized Germany’s pension strategy as out of touch with demographic realities.
Kirsten Brzeski, a global macro head at ING, stated that “governments seem to want to ignore demographic shifts and rising national debt.” Despite the challenges, Chancellor Merz has pledged broader reforms for pensions next year, considering options such as extending working years and increasing contributions to qualify for benefits.
A History of Struggles
During his campaign, Merz criticized the infighting that characterized the coalition of his SPD predecessor, Olaf Scholz. Expectations were quite high as he took office, intending to secure significant infrastructure spending and bolster Germany’s status as a major global player.
However, the instability of his own coalition has been concerning. Upon taking office, he uniquely requested a second parliamentary vote for formal approval. In the summer, his inability to rally conservatives behind an SPD-supported candidate for the Constitutional Court also hindered progress.
“The image of an incompetent and divided government is becoming firmly established,” noted Jan Tekau of Eurasia Group. Though he has received some international praise for his handling of the Ukraine situation, his domestic approval ratings have plummeted to around 25%, positioning him amongst the least popular prime ministers in memory.
According to the latest poll from Forsa, the combined support for both the Conservatives and the SPD has dropped to 39%, down from 44.9% following February’s election.
