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Burhop, Carsten
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IBF Paper Series 03-17
Corporate Retirement Plans during the Bonn Republic: Alleviating the consequences of the war were at the center of social policy during the early years of the young republic. Yet up to 1956 pensions rose only slowly and irregularly so that old-age poverty remained widespread. The transition to a dynamic pension system based on gross earnings with the 1957 Pension Reform was the major step from a social state battling need and poverty to the caregiving welfare state. The minimum pension – abolished in 1957 – was reintroduced with the 1972 Pension Reform, paving the way to the early retirement society. This paper investigates the development of corporate pension plans up to the end of 1970s. Using Volkswagen and Merck as case studies, it shows that companies reacted to changes in the economic situation earlier than did the legislature and adjusted their social benefits systems accordingly. Parallel to the transition to the dynamic pension system based on gross earnings during the late 1950s, corporate retirement plans experienced an expansion, that is to say, following the 1957 Pension Reform, private benefits were not yet replaced by public benefits. This did not change until the expansion of the social state during the 1970s. The objective of including the Works Councils in the corporate pension discussion was to curb corporate social benefits.
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Working Paper
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