Allianz CEO Oliver Bäte has stirred discussions surrounding Germany’s welfare system through bold proposals aimed at reforming sickness benefits and adjusting inheritance taxes.
During a recent interview with Handelsblatt, Bäte expressed deep concerns about the socio-economic health of Germany, pointing out alarming statistics about sick leave among workers. He remarked, “Germany is the world champion when itcomes to sick notes,” highlighting how employees averaged 20 days of absence per year, compared to the EU average of just eight days.
Bäte’s proposals are grounded on the beliefthat the current system creates disincentives for workers, pushing them away from the safety net and encouraging what he termed as “social hammock” behavior. “The entire system creates false incentives for people to slide from the safety net to the social hammock,” he stated, emphasizing the urgent need for reform.
A significant part of Bäte's plan includes reinstatement of the "Karenztag", previously abolished 55 years ago, which would require employees to bear the cost of the first day of illness. "Other countries like Sweden, Spain, and Greece still have this system, where employees do not receive pay on their first day off due to illness," he noted. This change aims to alleviate the financial burden on employers and health insurance systems, potentially resulting in savings of up to 40 billion euros annually, if Germany could align itself closer to the EU average of 3.5 percent spent on sickness rather than the current 6 percent.
He provided staggering figures to paint the picture: “Employers pay 77 billion euros per year for salaries of sick employees, with health insurers contributing another 19 billion euros. This totals to about six percent of the entire social welfare spending.” Such costs, Bäte argues, could threaten the sustainability of Germany’s social systems, particularly as the population ages.
Aside from reforms on sickness benefits, Bäte also advocates for increases to inheritance taxes as part of his broader economic vision. During the interview, he remarked, “I want to tax those who can live quite comfortably without working even one day.” He expressed his alignment with leftist political ideologies on taxing wealthy inheritors, but with caveats aimed at ensuring fairness. He insisted higher tax exemptions must accompany these changes to protect family homes from immediate taxation when passed down, thereby maintaining financial equity for middle-income families.
Despite his proposals, Bäte firmly opposed introducing wealth taxes, viewing such measures as counterproductive: “I don’t believe in punishing those who work hard and are successful,” he asserted. His philosophy seems anchored on the principle of rewarding effort, rather than facilitating dependence on inherited wealth.
With these proposals, Bäte opened the floor for discussion on what modern Germany should prioritize as it faces the reality of aging demographics and increasing social service costs. “We have to talk about what we can afford in an aging society,” he concluded, urging policymakers to reevaluate and adapt financial practices to secure long-term sustainability.
His recommendations urge not only for immediate policy adjustments but also for questioning “how we can make our system more efficient to save the possible 40 billion euros, which could benefit the healthcare system,” he explained.
While Bäte stands firm on these proposals, their implementation will undoubtedly require broad dialogue among stakeholders across the political spectrum, reflecting the complex and often contentious nature of welfare reform in contemporary Germany.
Through these declarations, Bäte has firmly positioned Allianz not only as one of Germany’s foremost insurance providers but also as a vocal advocate for responsible economic reform.
His spotlight on Germany’s sick leave issues serves as both a critique and call to action, challenging the status quo and advocating for solutionsthat are preventive rather than reactive. Whether his ideas gain traction remains to be seen, but they certainly contribute to the necessary debate on the future of Germany’s social policies.