The Public Pension Contribution Exemptions during Childcare and Women's Old-Age Pension Rights: A Comparative Analysis of Germany and Japan

Abstract

This paper focuses on Germany and Japan, where the conditions for married women to participate in public pension insurance and the mechanisms for exemption from contributions during childcare periods are different, and compares the background of the exemption system, the method and period of exemption, the financial resources and the effects on women's old-age pension entitlements and pension amounts. The German system was introduced to compensate for unpaid work during the childcare period and to strengthen women's pension entitlements. Depending on the child's birth year, a three-year period per child is recognized as a contribution payment period based on the average income of all insured persons, and the government covers the costs. Since the introduction of the contribution exemption system, women's old-age pension entitlements have been significantly strengthened, especially in former West Germany, where the proportion of female part-time workers is high. Japan's system was introduced to reduce the insurance contribution burden for those taking childcare leave. Under Employees' Pension Insurance, contributions are exempted during maternity leave and childcare leave. In the National Pension, contributions are exempted for four months before and after childbirth. The exemption period for contributions in Japan is shorter than that in Germany. In addition, since the contribution exemption applies only to insured persons, it has the effect of preventing reductions in old-age pension amounts due to childcare rather than strengthening the pension entitlements of women without existing pension rights.