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Guide no. 07/02: Setting off statutory pension claims against civil service retirement benefits

Guidelines

(1) The authorities in charge of managing civil service retirement benefits should regularly inquire with the central pension-paying agency what statutory pensions are paid that have to be set off against civil service retirement benefits.

(2) To ensure that refunds of excess payments of civil service retirement benefits can be claimed, the authorities in charge of civil service retirement benefits should periodically repeat these inquiries on or before the end of three years after the previous inquiry.

Background

Pursuant to the conditions laid down in Art. 55 Civil Service Benefits Act, statutory pension claims generally have to be set off against civil service retirement benefits. The statutory pension also has to be taken into account where it derives from paid employment into which the beneficiary has entered after retirement. Where the two types of retirement benefit coincide, the total of civil service retirement benefits and statutory pensions are only paid up to a specified ceiling (Art. 55 (2) Civil Service Benefits Act). The civil service retirement benefit is reduced by the amount that exceeds the ceiling.

Refund claims on account of excess payments of civil service retirement benefits are governed by the provisions of the German Civil Code about the restitution of monies obtained by way of unjustified enrichment. According to Art. 195 Civil Code, the applicable statute of limitation is three years.

In 1998, we found considerable excess payments due to statutory pensions that were not taken into account. We urged the authorities to verify their payment data against the data of all pension insurance bodies which are centrally held by the pension-paying agency.

The purpose of doing so is to identify beneficiaries of civil service pensions who, in contravention of their obligation and in spite of being directly asked, have not notified that they draw a statutory pension. The authorities undertook to verify the statutory pensions against the civil service retirement benefits at regular intervals.

(1) In 2009 and 2010, our Berlin, Frankfurt, Hamburg and Stuttgart field offices audited the “coincidence of civil service retirement benefits with statutory pensions (Art. 55 Civil Service Benefits Act)”. They found that some of the authorities failed to match their benefits data against statutory pension claims. This resulted in excess payments in cases where claims under both retirement benefits systems had been acquired.

(2) Where the authorities verified benefit claims against statutory pension claims, they partly repeated the verification at intervals of up to a decade. In a number of cases, excess payments accumulated whose refund could not be claimed due to the statute of limitation.

 

 

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