Federal budget | Poor-bashing becomes material violence

During the federal election campaign, Friedrich Merz declared: "We will turn this citizen's income system on its head, and we will be able to save tens of billions." Anyone familiar with the matter knows that this is impossible. Even the savings targets apparently agreed upon by the coalition committee of the CDU/CSU and SPD last week were immediately called into question by Andrea Nahles, head of the Federal Employment Agency (BA).

After the committee meeting, it was announced that savings of €1.5 billion were planned for the next year on the citizen's allowance, and even €4.5 billion in 2027. Labor Minister Bärbel Bas (SPD) is initially planning to further increase the budget for the current year. This will be discussed during the Bundestag's budget week on Friday. A total of €51.96 billion in expenditure is planned for basic security for job seekers, €5.15 billion more than in 2024. The cost of the citizen's allowance itself will rise by €3.1 billion to €29.6 billion. The federal government will contribute €13 billion to the costs of housing and heating, and €4.1 billion will be spent on measures to promote job integration.

At more than 5.5 million people, the number of recipients of citizen's allowance or benefits under the Social Security Code II remains high. This is not because people are quitting their jobs to make themselves comfortable in the social hammock, but because war refugees from Ukraine are not supported through the Asylum Seekers' Benefits Act (AsylbLG) but instead receive citizen's allowance. A year ago, 717,000 Ukrainians received citizen's allowance, including 212,000 children.

Where the money for the planned savings in the citizen's allowance will come from remains unclear. Although Ukrainian refugees arriving after April 1 will no longer receive citizen's allowance, according to the coalition agreement, they will instead receive benefits under the Asylum Seekers Benefits Act (AsylbLG). However, according to Federal Employment Agency (BA) head Nahles, this will only save €900 million in citizen's allowance. However, the federal government must reimburse the states and municipalities for the money they now have to pay, thus saving very little overall.

Even according to the government's expectations, the planned tightening of sanctions for recipients of the citizen's allowance will only result in savings in the tens of millions. Federal Labor Minister Bärbel Bas (SPD) considers it particularly important that those affected are "prepared" for the labor market. At the same time, Enzo Weber of the Federal Employment Agency's Institute for Employment Research warns against cuts in integration benefits: "If this were eliminated, it would have clear disadvantages – for those affected, but also for the labor market." Weber believes it would be sensible to continue to have Ukrainian refugees supported by the Federal Employment Agency, but to reduce the amount of benefits paid to them "for the initial period."

The coalition agreement between the CDU, CSU, and SPD provides for the introduction of a "new basic security system," according to which "placement should take priority." From the perspective of the "traffic light" coalition, this has been the reason for a "revolving door effect from the job center to temporary employment and back," as Green Party parliamentary group leader Britta Haßelmann put it.

Meanwhile, Hesse's Minister-President Boris Rhein (CDU) called for a reduction in "social costs" in an interview with "Bild am Sonntag." This would also make it possible to finance the electricity tax cut for all households, which the coalition has suspended until further notice. Rhein repeated the litany of CDU General Secretary Carsten Linnemann and Chancellor Merz regarding the citizen's income: "If someone refuses reasonable work, this must be sanctioned in such a way that it really makes it worthwhile to go to work again." Federal Employment Agency (BA) head Nahles recently emphasized that no significant financial impact is expected from the tightening of sanctions. In 2024, just €20 million was collected through sanctions.