analysis
The citizen’s allowance is not to be increased next year. It was originally intended to heal the wounds inflicted by the Hartz reforms within the SPD. But the issue is damaging the party.
The rain crackles on Thomas Wasilewski’s umbrella. The weather is gloomy this morning in Mönchengladbach. And the citizen’s allowance recipient’s mood is also gloomy. Today he found out that there will be no increase in his income, and that the citizen’s allowance will not be increased at the beginning of next year. Wasilewski is ill, can no longer work full-time because of his heart and is dependent on help from the state.
He was disappointed that the standard rate would not increase: “The electricity prices will rise,” he says. Then he will have even more problems paying for electricity. The Deutschlandticket will also probably become more expensive, and he may no longer be able to afford it.
When shopping, he will be able to put even less in his shopping cart and will have to restrict himself even more: “That means that on the 23rd day of the month you are broke and don’t know how you are going to get to the end of the month. That’s the problem,” says Wasilewski. “It was already difficult this year. Next year it will be even more difficult.”
The issue is damaging the SPD
The social associations are joining in the criticism. This means that the SPD is coming under fire from two sides: some are demanding that the citizen’s allowance should increase. And on the other hand, there is a heated debate about whether the citizen’s allowance is too high and whether it is still worth working. It is a debate that the SPD cannot win.
The Social Democrats had big plans for the Citizens’ Allowance. It was intended to strengthen social cohesion and help those in need. It was intended to heal the wounds that the Hartz reforms had inflicted, including within the SPD itself. And it was intended to show voters that the party’s heart still beats on the left.
After just over 600 days of citizen’s allowance, the interim conclusion is: the plan is failing, the issue is damaging the SPD. Now many workers are asking themselves whether the workers’ party is still there for them.
Calculated according to a complicated formula
And the CDU likes to pour oil on the fire: “The gap between those who earn and work and those who receive citizen’s allowance and could work, this gap has unfortunately become far too small,” says the deputy leader of the Union parliamentary group, Mathias Middelberg.
The citizen’s allowance has been increased by a total of more than 20 percent in “two huge steps” over the past two years. “That’s a problem,” criticizes Middelberg. “No other employee in Germany has received such a large wage increase.”
The SPD is following the discussion. The problem: When asked how much citizens’ allowance recipients should receive, many people answer it based on gut feeling. In reality, however, the citizens’ allowance is adjusted according to a complicated formula that takes into account both general wage increases and inflation. The calculations sometimes use data that is a year old. That is why an additional step has been built in to compensate for inflation in the meantime and the near future.
Heil defends himself against accusations of arbitrariness
If you read the 16-page draft for the next adjustment of the citizen’s allowance to the end, you will see that with this complicated calculation, the Ministry of Labour and Social Affairs comes up with a citizen’s allowance of 539 euros for a one-person household for 2025.
So the increase last year seems to have compensated for inflation more than it did in the end. However, since the Citizen’s Allowance is protected and the law does not provide for a reduction, there will now be no increase and the amount will remain at 563 euros, which was set last year.
“When prices are high, the minimum subsistence level must be secured by increasing them. When prices go down, then there is sometimes a move towards a zero increase,” says Labor Minister Hubertus Heil. The SPD politician defends himself against the accusation of arbitrariness: “It is not a case of rolling dice every year as to how the standard rates increase. Rather, there are constitutional requirements and there is an adjustment mechanism that the German Bundestag has decided on.”
The debate relies on envy and emotion
In fact, the government is only implementing laws when it comes to adjusting the citizen’s allowance. But the political discussion is of course different and is based on envy and emotion. The SPD has not yet found a message against this. The amount has always been controversial – even among scientists.
Social scientist Stefan Sell from the University of Koblenz sees a birth defect in the Citizen’s Allowance. There was already a weakness in the sample used to calculate the Citizen’s Allowance, he says. It was too low.
“And the increases won’t change this imbalance,” says Sell. “They will drag this error up with them.” The increases themselves are simply implementing a ruling by the Federal Constitutional Court. The legislature must react to inflation promptly and adjust: “These increases are not something that has been generously conjured up out of thin air to do something good for people receiving citizen’s allowance.”
The SPD will probably continue to pursue the discussion about the citizen’s allowance – just a few weeks before the important state election in Brandenburg, where the party wants to continue to provide the state premier.
Citizen’s allowance recipient Thomas Wasilewski has lost faith in the SPD and does not want to accept the zero increase in the citizen’s allowance. He is already taking legal action for a higher citizen’s allowance.