18 years after the start of Hartz IV, the citizen’s income is to replace the previous rules for the unemployed in Germany in the new year. In November, after a long struggle, the Bundestag and Bundesrat passed the law, which is considered the most important social reform of the traffic light coalition. An overview:
What does the citizen money bring to the standard rates?
The rates increase by around 50 euros. In the future, the expected price development will be included in the calculation of the basic security more promptly. For single and single parents entitled to benefits, there are 502 euros per month from January 1st, for two adult partners in a so-called community of needs 451 euros each. For young people between the ages of 15 and 18, 420 euros flow. Children from the age of 7 to the age of 14 receive 348 euros. For children up to the age of 6, 318 euros are paid.
What does the new grace period mean?
The adequacy of the apartment will only be checked after a waiting period of 12 months. Until then, the actual costs of the apartment will be covered. The waiting period does not apply to heating costs that are granted to an “appropriate extent” from the start. In the first 12 months, assets of up to 40,000 euros remain protected for the first person in the benefit community. For each additional person in the community, this allowance increases by 15,000 euros. These regulations also come into force on January 1st.
What applies to assets after the waiting period?
After the waiting period, there is an asset allowance of 15,000 euros for each person in the benefit community. Reserves for old-age provision for the self-employed and owner-occupied residential property should also be better protected.
What should be improved when it comes to placement in a job?
Citizens’ income puts an end to the so-called mediation priority. Until now, job centers have often placed unemployed people in helper jobs, which they then did not do for long. In the future, further training and the acquisition of a vocational qualification will be more in the foreground. In addition, access to funding for start-ups is simplified.
What should change with the sanctions?
Since 2005, the job centers had disciplined uncooperative Hartz IV recipients according to the principle of “support and challenge” by turning off the money tap. The Federal Constitutional Court had already severely restricted this sanction practice in November 2019 after years of criticism. Most recently, a sanctions moratorium applied. That is now rescinded. For this reason, reductions in citizen’s income are possible again from the beginning of the year if people do not comply with their obligations to cooperate or if they do not appear at appointments.
What sanctions should there be?
If appointments are missed without an important reason, the standard requirement can be reduced by 10 percent for one month. If, contrary to agreement, someone does not apply for a job or does not take part in a course, the standard requirement can initially be reduced by ten percent for one month. In the event of a second breach of duty, a reduction of 20 percent applies for two months and, in the last stage, by 30 percent for three months.
What will change with the citizens’ income at the beginning of the year?
Up to a de minimis limit of 50 euros per benefit community, no more decisions are issued with the repayment of benefits. A special regulation according to which older beneficiaries are no longer considered unemployed after 12 months of benefit receipt without a job offer will be repealed. And the social labor market will be open-ended: People who are very far from the labor market should be able to take up publicly funded employment subject to social security contributions on a permanent basis.
What happens to the allowances for employed persons?
As of July 1st, the allowances for all employed persons will be improved. With an income between 520 and 1000 euros, 30 percent of this can be kept. According to the Federal Ministry of Labor this means up to 48 euros more in the wallet than before. Young people are allowed to keep the income from school and student jobs and from vocational training as well as the pocket money from a federal voluntary service or voluntary social year up to the mini-job limit of currently 520 euros. Income from student jobs during the holidays is not taken into account.
What is changing in the relationship between job centers and the unemployed?
A cooperation plan is to replace the formal integration agreement. This plan is to be drawn up in understandable German by job center employees and those receiving citizenship benefit. It should not contain any instruction about possible legal consequences. “The cooperation plan will gradually replace the expiring integration agreements by the end of 2023,” says Labor Minister Hubertus Heil (SPD).
How should the unemployed with special problems be helped?
In the future, those receiving citizenship income should be able to receive holistic coaching. The coaching should also be outreach, training or employment-related. There should be more training bonuses. It should now be possible to receive a monthly training allowance of 150 euros for the unemployed and the employed. In addition, those affected should be given more time to study.
