German parliament approves new welfare scheme

German lawmakers have voted to replace the “Hartz IV” social safety net with a new proposal from the ruling center-left coalition containing more benefits.

The German parliament on Thursday approved the so-called “Bürgergeld” social welfare program for unemployment benefits.

The proposed changes are a major cornerstone policy of Germany’s center-left coalition government of Social Democrats (SPD), Greens and the business-oriented Free Democrats (FDP).

The conservative CDU/CSU opposition in the Bundestag criticized new scheme, with one senior official claiming it would “set a pattern of receiving benefits and lead to de-motivation instead of new employment.”

What is ‘Hartz IV’?

Currently, anyone who cannot find employment or is unable to work receives basic social security in Germany. This system is known colloquially as “Hartz IV.”The money is supposed to cover basic living expenses such as rent, heating and water, groceries as well as health insurance. 

Experts have long argued that the amount allocated wasn’t sufficient to cover these expenses.

As Germany is experiencing a soaring cost of living and rapidly increasing inflation, the urgency to decide on adjustments to the social welfare program has grown. 

The new system is set to become effective in January 2023. 

What will change with ‘Bürgergeld’?

The federal government has proposed raising the standard allowance from €449 to €503 per month, beginning in 2023.

Households will also receive more money for their underage dependents,  — €420 for those aged 14-17, €348 for those aged 6-13, and €318 for those aged five or younger.

According to the plans, those receiving benefits will also get more support in gaining new vocational skills to prepare for permanent employment through increased training.

During vocational qualification, recipients would be granted another 150€ per month, or an additional 75€ if other training measures are accepted.

This measure is also supposed to mitigate the shortage of skilled workers Germany is currently experiencing.

Source: DW