Tarifabschluss costs Saxony more than half a billion euros - Saxony approves 5.8% public sector pay rise over 27 months
Saxony's Public Sector Pay Deal Brings Substantial Additional Costs
The new collective bargaining agreement for public sector employees will come at a steep price for Saxony. This year alone, the deal will incur extra costs of around €92 million, with a total of approximately €450 million expected for 2027 and 2028—based on 2025 figures—according to the state's Finance Ministry in Dresden. Despite the financial burden, Minister Christian Piwarz (CDU) described the outcome as a "realistic result" and a "manageable compromise in financially challenging times."
Additional Costs for This Year Already Factored Into Budget
"The agreement recognizes the contributions of public sector employees while also taking into account the difficult budgetary situation facing the federal states," Piwarz emphasized. As the lead negotiator for the employers' side in his role as first deputy chair of the states' collective bargaining association, he noted that the costs for this year had already been accounted for in Saxony's current budget.
Under the deal, employees will receive a total pay increase of 5.8 percent in three stages over 27 months. The agreement was reached after weeks of negotiations between employers and unions, finalized on Saturday.
Wages will rise by 2.8 percent—or at least €100—starting April 1, 2026, followed by a further 2.0 percent increase on March 1, 2027. The final step, a 1.0 percent raise, will take effect on January 1, 2028.
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