Tag: Germany

Germany’s finance ministry dismissed as ‘speculation’ a newspaper report that it is considering partly plugging its budget deficit by selling the pension receivables it gets annually from the former state monopolies Deutsche Post World Net AG and Deutsche Telekom. ‘We don’t comment on such speculation,’ a finance ministry spokesman in Berlin said. The report in the Financial Times Deutschland, citing unnamed sources, stated potential buyers could be private investment banks such as Deutsche Bank, Morgan Stanley and Goldman Sachs, as well as the state-development bank Kreditanstalt fuer Wiederaufbau (KfW). The ministry supervises the pension fund of all civil servants. A huge number of Deutsche Post and Deutsche Telekom employees retained their status as civil servants even after the entities were transformed into private limited companies prior to their listings.

The German government is considering asking Deutsche Post AG and Deutsche Telekom AG to transfer pension payments totalling billions of euros to the state in order to help plug the budget deficit, Financial Times Deutschland said, citing government sources.

It said by taking over the long-term pension payments meant for employees of the former state monopolies, the state would then receive in the short-term a cash injection of several billions of euros from the two companies.

The government would then not need to come up with an austerity programme and would be able to keep its 2005 budget deficit at 3 pct of GDP, it added.