The Free Democratic Party of Germany (FDP) has called for a reduction in the citizen’s income, citing overestimation of inflation rates. This move comes as the government plans to reduce spending on the welfare program, sparking concerns about fairness and the impact on low-income individuals.
In Germany, approximately 5.5 million people receive citizen’s income, with single recipients currently receiving 563 euros per month. FDP parliamentary group leader Christian Dürr argues that this amount is too high and has called for a reduction. Dürr told the Bild newspaper that the current citizen’s income is “14 to 20 euros per month too high” due to an overestimated inflation rate during the last calculation.
Dürr proposes lowering the monthly payment for single recipients to 543 euros, which would reduce the burden on taxpayers by up to 850 million euros and increase work incentives. He urges for these cuts to be implemented “as quickly as possible.”
Zero increase expected in 2025 and criticism from social associations
The government’s draft budget for 2025 includes plans to spend 5.5 billion euros less on citizen’s income. Additionally, recipients may face a potential zero increase in their payments for 2025. Labor Minister Hubertus Heil (SPD) mentioned in May that the higher payments in early 2024 were due to significant inflation, but with prices now rising more slowly, there could be no increase in 2025.
A spokesperson for the Labor Ministry echoed this sentiment in late July, stating that with declining inflation rates, there may be no increase in payments as of January 1, 2025. The Social Association of Germany (SoVD) has criticized this possibility as unfair. SoVD chairwoman Michaela Engelmeier expressed outrage, calling the potential zero increase “an insult” and demanding that the calculation of needs be adjusted to reflect the reality of people’s lives.
Impact of changes to housing costs and ongoing disputes
In early 2024, the standard rates for citizen’s income increased significantly due to high inflation, with single recipients now receiving 563 euros per month, 61 euros more than before. The Jobcenter also covers actual housing costs, including rent and heating.
However, as of July 1, 2024, costs for TV cable connections can no longer be billed as part of ancillary expenses, meaning Jobcenters can no longer cover them as part of housing costs. This change is seen by the housing industry as a de facto reduction in citizen’s income, potentially leading to higher expenses for about two million recipients.
Citizen’s income has been a contentious issue since its introduction, with critics arguing that it is too attractive for those unwilling to work. The FDP has consistently advocated for using the income to encourage more people to enter the workforce. In June, Dürr told RP Online that getting more people into regular employment would also relieve the budget.
Economic expert Veronika Grimm recently suggested that citizen’s income recipients who take up employment should be allowed to keep more of their earnings. She proposed combining this with sanctions for those who refuse reasonable work offers, arguing that this would make leaving citizen’s income more financially rewarding.
Stricter sanctions and recalculation concerns
Sanctions are another hotly debated topic. The current government has toughened sanctions for citizen’s income recipients who fail to meet their obligations without a valid reason. Jobcenters can now cut benefits for up to two months or completely withhold them if recipients consistently refuse job offers.
The calculation of citizen’s income is based on a legal formula that considers price increases, but the actual inflation was lower than expected when the payments were last raised. This discrepancy has fueled calls for a reduction in the monthly amounts.
