More money, less sanctions – this is how the SPD plans to end Hartz IV

fFor the Federal Labor Minister Hubertus Heil (SPD), this is a kind of symbolic liberation. He wants to be the man who liberates both the country and his party from Hartz IV – where liberation can be taken literally. As the SPD has been wanting for years to say goodbye to unemployment benefit II, as the unemployment benefit is officially called – once settled in the 2010 Schröder Agenda, Hartz IV was repeatedly blamed by Germany’s oldest party for numerous electoral failures.

Now a new name is to come: civic money. This is what it says in the coalition agreement on traffic lights. Labor market reform should bring “more respect” and “more social security” and create a new “culture of trust in employment offices”.

Heil has now announced the most important planned innovations: This includes a new waiting period for housing and assets. In the first two years, benefits are granted if there are no “substantial” assets, which are estimated at € 60,000.

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In addition, the “protected assets” will be increased – for example, vehicle fitness testing will no longer apply and Community benefit per capita will be increased to € 15,000. Allowances for pupils, students and trainees will also be increased to 520 euros.

New is the six-month “confidence period”, during which performance degradation in the event of breach of obligations is excluded. Only in the event of a “breach of trust” after six months should the employment office establish binding obligations to cooperate. Site visits may remain compulsory from the outset but should be possible informally.

The “social labor market” is to have an unlimited period of time

Allowance reductions are re-regulated: inter alia, young people are excluded and accommodation costs are excluded. The additional benefits include a monthly “Allowance for Further Training” of EUR 150 and a “Citizenship Allowance” of EUR 75 for participation in “Actions of particular importance for Sustainable Integration”.

Part of the reform should also be the fact that the “social labor market” has an unlimited time – so far it was decided on only until 2024. In addition, applications are to be submitted digitally from 2023. Overall, innovation should enable the recipients of citizens’ income to concentrate more on further education and job search.

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To bring all of these innovations to life in early 2023, Heil needs his coalition partners. So far, the Greens have not been able to agree on a common position. The FDP is encouraged by labor policy spokesman Pascal Kober, who welcomes issues such as digitalisation and student and student benefits.

But other details in the coalition are still unclear. In June, Heil published the first details of citizens’ income. The amounts should probably increase by 40 to 50 euros, almost ten percent more. FDP party leader Christian Lindner immediately warned that citizens’ income should not be “an extension of social redistribution.”

Lindner rejects citizens’ sanctions-free income

Now Lindner is following this example: he rejects the rapid increase in base wages as well as the citizen’s income without sanctions. “This year, we gave one-off payments to people who receive basic insurance, which I believe alleviates the greatest social hardship.”

While there was a standard rate hike in January that mirrors the rise in inflation, Lindner told ntv. However, he goes on to say: “I am not in favor of raising standard rates around the world, other than to adjust for inflation.”

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Additionally: The suspension of sanctions, which should be valid for one year, “under no circumstances” can be seized on citizens’ income. “Sanctions must be in place for breach of obligations. Anyone withdrawing, for example because deadlines are not met, must be able to set a limit through sanctions. Citizens’ income cannot become an unconditional basic income ”.

Jens Teutrine, the Citizens’ Benefit spokesman for the FDP parliamentary faction, also criticized: “Anyone who fails to attend meetings or refuses further training and job opportunities must, as agreed, be sanctioned up to 30%. future”. Heil “bypasses” this point – the man will hold the coalition partners responsible.

“Citizenship Benefit is a Joint Project”

On both points – the rise in rates and the issue of sanctions – Heil and the FDP do not seem to be on the same page. However, the labor minister dismissed it: “Citizen’s income is a joint project of the coalition.” There are still a few questions that need to be answered. But: “We’re on one side 80 to 90 percent.”

So far, social associations in particular have pushed for higher standard rates. The daily rate is currently only € 5.20 for food and non-alcoholic drinks. Food inflation rose to 11.9 percent in June compared with the same month last year, according to the Federal Statistical Office.

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The social association VdK and the Paritätischer Gesamtverband therefore asked for an increase to 680 euros. According to Heil, agreement on exact growth has still not been reached; But the schedule is ready: the bill is ready, the government’s decision is expected in September and will enter into force in January.

It is also unclear exactly how the reform is to be financed. A EUR 50 increase alone would correspond to almost EUR 2 billion of additional expenditure. “The law is not free,” said Heil.

In concrete terms, however, financing can only be planned after a rate hike is agreed. One thing is certain: the budget would have to be shifted. In any event, Heil pointed out that the Finance Minister had “built up reserves”.

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