Heil needs 2.1 billion more
Citizens’ money causes a cost shock
November 10, 2023, 1:31 a.m
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When it was introduced, Labor Minister Heil praised citizens’ money as a reform of the century. Now the traffic light amendment is causing a lot of trouble. Because the economic situation is bleak, costs are exploding to almost 26 billion euros a year. The Union sees a system error.
According to a media report, the new citizens’ money causes significantly higher expenses than the federal government planned in the budget for the current year. Federal Labor Minister Hubertus Heil from the SPD needs up to 2.1 billion euros more than provided for in the budget, as the “Bild” newspaper reported, citing a letter from Finance State Secretary Florian Toncar to the Bundestag’s budget committee.
According to this, Heil has applied for “an over-plan expenditure” of up to 2.1 billion euros because the number of citizens’ benefit recipients has increased due to the “significantly deteriorating economic situation”, “Bild” quoted from the two-page letter. Citizens’ money spending is expected to rise to a total of 25.9 billion euros this year.
According to the report, those receiving citizens’ benefit apparently also need more benefits. The “net benefits per community of need” have “developed more dynamically compared to the expectations from autumn 2022,” says the letter to the budget committee.
Union: System creates false incentives
In view of the figures, the budget policy spokesman for the CDU/CSU parliamentary group, Christian Haase, now fears a further increase in citizen’s money spending in 2024 to more than 27 billion euros. That would be around five billion or a good 22 percent more than in 2022 (Hartz IV). “The increases show that this system creates the wrong incentives. Too much hazing, too little demand and support. This spending dynamic must be slowed down,” said Haase.
Currently, more than five million people in Germany receive citizen’s benefit. From January 2024, citizens’ money will be increased by twelve percent. The unusually high increase decided by the federal government is due to inflation and rising net wages. Citizens’ money replaced the previous Hartz IV payments at the beginning of the year.