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Coalition Agrees to Raise East German Pensions

FILE - German Chancellor Angela Merkel speaks near a photograph of the former Berlin Wall, which had separated Germany’s west and Communist east for decades until late 1989. The country’s ruling coalition agreed to increase pensions for former East Germans.

Germany's ruling coalition agreed on Thursday to gradually raise state-backed pensions of those from the former Communist east to match western German levels from 2018 through 2025, a memorandum about the meeting showed.

The agreement was reached during a late-night meeting of leaders of Chancellor Angela Merkel's conservative Christian Democrats (CDU), their CSU Bavarian sister party, and the Social Democrats (SPD), the junior party in the coalition.

The pension deal comes as the parties in Merkel's "grand coalition" gear up for national elections in September 2017 after a series of embarrassing losses to the anti-immigrant Alternative for Germany (AfD) party in regional elections.

Merkel, who has faced voter backlash over her open-door refugee policy, particularly in the former east, said Sunday that she wanted to run for a fourth term as chancellor. The parties have said they did not want to fight the election with competing pension promises.

It was not immediately clear how much the pension adjustments would add to Germany's annual budget.

Coalition leaders also agreed to increase disability pension benefits from 2018 through 2024, and to rapidly implement previously agreed occupational pension reforms, according to a meeting summary viewed by Reuters.

Leaders of the parties in the coalition failed to agree on supplements for those with low pensions from years of earning low incomes, with various alternatives still being studied.