The future of social security in Germany is taking a significant turn as the coalition partners CDU/CSU and SPD have agreed to replace the Bürgergeld with a new basic security system. This decision, outlined in a 162-page coalition paper, signals a departure from recent reforms aimed at supporting job seekers and improving their financial security.
The Bürgergeld, which was introduced on January 1, 2023, was designed to provide a more responsive and realistic calculation of living costs for those in need. Previously, the standard requirement was calculated based on the income and consumption sample (EVS), which was only conducted every five years. This outdated method often failed to keep pace with rising living costs, particularly during the pandemic when prices surged for essentials like food and energy.
During the pandemic, the inadequacies of the old system became glaringly apparent. The Federal Constitutional Court had ruled in 2014 that the government was obliged to adjust standard rates immediately in the event of unexpected price increases. However, the previous government’s response was limited to minor one-off payments, rather than a comprehensive review of the standard rates. This left many Bürgergeld recipients in dire financial straits.
With the introduction of Bürgergeld, the calculation of standard rates improved significantly. It now includes an annual inflation component alongside the five-year EVS, allowing for quicker adjustments in response to price increases. However, despite these improvements, the planned return to the old calculation model appears to be primarily financially motivated, as the government seems to overestimate current inflation trends.
Critics are raising alarms about the implications of this shift. The proposed new basic security system will enforce stricter requirements for recipients, including a mandate to accept job offers more quickly. This approach, which emphasizes immediate employment over skill development, has drawn criticism for potentially pushing individuals into unsuitable jobs rather than fostering long-term career growth.
According to the Federal Employment Agency (BA), job centers issued just under 20,000 sanctions for rejected job offers, affecting only about one percent of Bürgergeld recipients. The new regulations aim to increase this number, with the intention of enforcing compliance through stricter penalties.
Another significant change under the new basic security system is the removal of the asset protection period that currently allows individuals to retain savings of up to 40,000 euros for the first person in a household and 15,000 euros for each additional person. This change means that the state will now scrutinize the assets of applicants more closely, limiting support to those who do not have sufficient resources to cover their living expenses.
While the coalition partners claim that the new system will provide better support for job seekers, many argue that it will merely serve to deepen the existing issues of poverty and dependency on state aid. Critics like Anja Piel of the German Trade Union Confederation (DGB) have called this approach a "serious mistake," arguing that it undermines the progress made by the Bürgergeld reforms, which focused on supporting individuals through training and skill development.
Moreover, the concept of a "personalized offer of advice, support, and placement" is being replaced by a more rigid requirement for individuals to actively seek employment. The previous model encouraged collaboration between job centers and recipients to create sustainable employment strategies, whereas the new system shifts the responsibility entirely onto the individuals, many of whom face complex barriers to employment, including educational deficits and mental health issues.
Friedrich Merz, the leader of the CDU, has stated that for individuals who can work but repeatedly refuse reasonable job offers, there will be a complete withdrawal of benefits. This approach raises serious concerns about the potential for individuals to fall below the poverty line, as the new basic security system may not adequately account for the current cost of living.
In 2019, the Federal Constitutional Court ruled that sanctions exceeding 30 percent of benefits were unconstitutional, emphasizing the need to ensure a dignified existence for all citizens. The coalition’s plans to implement total sanctions could lead to a legal battle, as the proposed measures could violate this constitutional mandate.
As the coalition negotiations continue, the implications of these proposed changes remain a contentious topic. Many advocates argue that instead of imposing stricter penalties and reducing benefits, the government should focus on enhancing support systems that empower individuals to improve their skills and secure stable employment.
The DGB has consistently emphasized the importance of vocational training and education as the most effective means of helping unemployed individuals reintegrate into the workforce. With two-thirds of Bürgergeld recipients lacking formal qualifications, the need for targeted training programs has never been more critical.
As discussions progress, it is clear that the future of social security in Germany hinges on the balance between enforcing compliance and providing genuine support for those in need. The proposed new basic security system may reflect a shift towards stricter measures, but the long-term consequences for recipients could be detrimental if not carefully considered.
Ultimately, the challenge will be to create a system that not only demands accountability from recipients but also offers the necessary resources and support to help them thrive in the labor market. As the coalition partners move forward, the voices of those affected must not be overlooked, ensuring that the new policies serve to uplift rather than undermine the most vulnerable members of society.
