Citizens’ income is to replace the unpopular Hartz IV as early as January. The law has not yet been passed and poses challenges for the Federal Employment Agency. The board of the authority came up with the idea that the traffic light should postpone the introduction.
The CFO of the Federal Employment Agency, Christiane Schönefeld, has called on the federal government to postpone the introduction of citizen income. “We have urgently asked the Federal Minister of Labor to gradually introduce the new rules on citizen income by July 2023,” said Schönefeld of the “Rheinische Post”. Schönefeld referred to the complex rules: “We welcome the reorientation, be it better funding opportunities, the partnership or the elimination of priority mediation,” she told the newspaper. However, the authority needs a postponement: “We will not be able to implement everything by January 1st, there is no time for that because the law has not yet been passed.”
From January, according to previous plans, the new citizen’s income is to replace the previous Hartz IV system. In mid-September, the Federal Cabinet introduced the draft law by Federal Minister of Labor Hubertus Heil, which provides for a significant increase in standard rates. Better additional income opportunities and the retention of the previous sanctions in a milder form as well as more help for qualification and further training are also planned. The standard rate for single adults increases by EUR 53 from EUR 449 to EUR 502.
The payment of the higher rates does not have to be postponed, said the BA board member. “I explicitly exclude the higher standard rate from this, which we will implement in January.” Schönefeld defended the increase against criticism, especially from the Union. “The higher standard rate is correct, because the prices are increasing enormously,” the newspaper continued to quote. At the same time, she warned: “Adequate financing is important if the introduction of citizen income is to succeed. It would be a shame if, for example, the further education allowance failed due to a lack of finance.” The contribution to unemployment insurance will be sufficient as long as the energy crisis does not get worse, Schönefeld calculated: “The contribution will be 2.6 percent again as planned in 2023, the temporary reduction to 2.4 percent will expire at the end of the year get by in the next few years – but that only applies if the labor market remains stable.”
Last week, the head of the Federal Employment Agency, Andrea Nahles, assessed the labor market in Germany as stable. “Yes, we are threatened with a recession,” Nahles told the editorial network Germany. “But the good news is: the labor market is robust.” Nahle’s social-democratic party friend Heil had previously acknowledged obstacles to the introduction of citizen’s income. Citizens’ income will come into force on January 1st – and from then on the new standard rates will also apply. The implementation should then take place “step by step” – for example because IT systems would have to be adapted, the minister announced in mid-September.
