Citizens’ income is coming and will replace Hartz IV. For single benefit recipients, the standard requirement will be 502 euros per month from next year instead of the previous 449 euros. However, the reform of basic security has some shortcomings.
SPD, Alliance Greens and FDP have agreed on a comprehensive reform of the basic security for job seekers known as “Hartz IV”. The popularly also called unemployment benefit II and the social benefit for non-employable members of the need community – mainly children under 15 years of age – are replaced by a “citizen’s benefit”.
Federal Chancellor Olaf Scholz (SPD) proudly announces on Twitter: “On January 1, we will leave Hartz IV behind us.” Whether the traffic light coalition he is leading will actually abolish the basic security system with citizen benefits, which his benefit recipients hate, or only mitigate it , will be discussed below.
Because of the Covid-19 pandemic, the grand coalition eased access to Hartz IV in March 2020. This related to the savings and the review of the size of the apartment and the amount of rent, albeit only for half a year. The SPD, Alliance Greens and FDP adopt these regulations for citizen income and extend the period to two years so that those entitled can concentrate fully on looking for work. Also for two years, the actual costs for accommodation and heating are recognized, even if they are actually considered to be unreasonable.
The polarizing pandemic: Germany after Corona
During this “waiting period”, assets are not taken into account in the means test, provided they do not exceed EUR 60,000 and an additional EUR 30,000 for each additional member of the same benefit community. After that, the protective assets are still 15,000 euros per person in the benefit community. Owner-occupied residential property is not taken into account if the house plot does not exceed 140 square meters of living space or the condominium is no larger than 130 square meters. The regulations mentioned are more generous than the previous ones and expedient, but only “new customers” of the job centers and better-off beneficiaries benefit from them.
Prof. Dr. Christoph Butterwegge is a political scientist and poverty researcher, taught political science at the University of Cologne from 1998 to 2016. On May 18, 2022 his book “The Polarizing Pandemic. Germany after Corona” at Beltz Juventa.
If the previous integration agreement between the job center and those entitled to benefits laid down their duties in detail without the latter committing themselves to any support services, both sides should henceforth negotiate “on an equal footing” and, after a “potential analysis” by the employment agency, draw up a “cooperation plan”. work out, which documents the jointly developed integration strategy “in clear and understandable language” and acts as a kind of red thread in the integration process.
Because, unlike at the turn of the millennium, when Hartz IV was developed, the job market today lacks skilled workers and the collective aging of the population due to demographic change does not promise any change in the situation in the near future, people who receive basic social security are to be given the opportunity to focus more on their professional qualifications and further training to concentrate. The placement priority, which ensured that school education, vocational training and vocational qualification-related further training took a back seat to taking up work, will therefore be abolished.
In order to create greater incentives for the low-skilled to complete vocational training, those receiving citizenship benefit participating in a further training measure receive a “further training allowance” of 150 euros per month. In addition, the time granted for retraining within the framework of subsidized further vocational training will be extended from two to three years. The existing bonus regulations for the successful completion of intermediate and final examinations will be extended indefinitely. For participation in a measure for sustainable integration (e.g. a language course), a “citizen’s allowance bonus” of 75 euros per month will be introduced.
The financial support for employment subject to social security contributions on the social labor market will be made permanent and a regular instrument. In the long term, it is hoped that this will result in more transitions from long-term benefit recipients to normal employment. However, the fact that the budget for integration measures was recently reduced by Federal Finance Minister Christian Lindner (FDP) does not speak for the high status of the social labor market.
A de minimis limit of 50 euros will be introduced for the reclaims from the job centers, which relieves the administration and lowers its costs. The waiver of the permanent on-site presence of the benefit recipients not only corresponds to today’s lifestyle, but also benefits the employees of the job center, for whom there is no control effort.
To ensure that the training allowance and a part-time job for pupils, students and trainees do not lead to a reduction in performance, the allowance is increased to 520 euros per month. Later, the opportunities for earning additional income from basic income are also to be improved for adults, which is problematic because it would lead to further inflation of the low-wage sector. The more a citizen recipient who works is allowed to keep from his wages, the easier it can be squeezed by a profit-hungry entrepreneur.
A major shortcoming of this citizen income reform is the waiver of a greater increase in standard needs than the explosion in energy prices and inflation made necessary, as well as the fundamental correction of the procedure for determining and updating standard needs. Because the standard requirements for citizen income must – as required by the Federal Constitutional Court for Hartz IV – be determined “in a transparent and appropriate procedure that is realistic and comprehensible on the basis of reliable figures and conclusive calculation methods” and adjusted as quickly as possible to the cost of living, which will probably rise massively in the long term.
For single beneficiaries, the standard requirement should be 502 euros per month from next year instead of the previous 449 euros. Although this compensates for the current rise in prices, it does not guarantee that as a recipient of basic income you can live in dignity, eat healthily, dress decently and participate in social, cultural and political life. Also, the citizens’ benefit is not a wage replacement benefit, the amount of which depends on the last net wage or salary, as did the unemployment benefit abolished with Hartz IV. So it does not take into account what someone earns and how long they worked before they had to claim basic security.
However, there is a greater differentiation between the previous Hartz IV recipients and ultimately social selection. For the “passengers” of the job centers, i.e. benefit recipients who can be placed quickly because of their qualifications or after further vocational training, the citizen’s income represents something like Hartz IV light.
The socio-political paradox of the citizen benefit reform is that those Hartz IV dependents who are in the worst financial, health and psychological condition in the long-term or long-term receive the least help, while beneficiaries who only receive benefits for a short time because they are well qualified or successfully complete further vocational training measures, will be even more favored by the planned new regulations.
