The cabinet in Berlin approved the reform of the basic social assistance Bürgergeld and stricter rules for recipients. The bill has faced criticism within the SPD and still needs to be approved by the Bundestag.
The German government has decided to discontinue the social benefit "Bürgergeld" in its current form. On Wednesday, December 17, the cabinet approved a bill by Federal Labor Minister Bärbel Bas, which provides for the introduction of a new basic social security benefit.
For approximately 5.5 million recipients of Bürgergeld, this means a significant tightening of the rules. After the cabinet's decision, the bill still needs to be approved by the Bundestag. The ruling parties forming the government have a majority in parliament. However, there remains significant resistance to the reform within the Social Democratic Party of Germany, a participant in the ruling "grand coalition". It is set to come into effect on July 1, 2026.
Disputes in the Government over Bürgergeld
There have been ongoing disputes within the government regarding the details related to the potential complete abolition of social benefits. According to the plans, this will become possible in cases where recipients of the benefit are unavailable: if a person misses three invitations to meetings, employment centers will be able to stop the payments.
Housing payments may also be at risk. At the same time, the recipient of the benefit will be required to be given the opportunity to provide explanations - for example, by phone or in a personal interview. People with mental illnesses will be protected from complete loss of benefits.
Tightening of Requirements
A stricter approach is also provided regarding the assets of social benefit recipients. The bill abolishes the fixed exemption period during which personal savings are not taken into account. From now on, before receiving the benefit, applicants will have to rely on their own income and assets. The amount of protected savings will depend on age. Housing expenses are expected to be recognized only to a small extent.
The primary task of employment centers should be to employ recipients. If retraining seems more promising, it will continue to be prioritized. Specific support measures should be documented in a jointly developed cooperation plan between the agency and the recipient of the benefit.
Limited Financial Effect
Significant savings from the reform are not expected. In 2026, the expenses of federal authorities, states, municipalities, and the Federal Employment Agency are expected to decrease by a total of 86 million euros, and in 2027 by 70 million euros. In subsequent years, on the contrary, an increase in expenses of 11 and 9 million euros is forecasted, respectively.
