Couples with high incomes should no longer receive parental allowance in the future. There has been a lot of criticism for these plans by the traffic light coalition. Public approval is rarely heard.
The Federal Ministry for Family Affairs will also have to make do with less money in the coming year. After the crisis-related additional spending in previous years, the traffic light coalition is cutting government spending. The fact that there should now be cuts in parental allowance of all things is sharply criticized – even if it should only affect the high earners.
Who gets parental allowance?
With parental allowance, the state supports parents who do not work or only work a little after the birth of the child and thus earn little or no money. It must be requested. Parents with higher incomes receive 65 percent of the net earnings they had before the birth, parents with lower incomes up to 100 percent.
There is at least 300 euros per month. Parental allowance is capped at 1,800 euros. From about 2700 euros net monthly income, it does not increase any further. The parental allowance is paid for a maximum of 14 months if both parents participate in childcare. The payment period can also be extended further (ElterngeldPlus). The monthly payments are then smaller.
How long has this been around and what was the reason for its introduction?
The parental allowance was introduced in 2007 and replaced the previous child-raising allowance, which was a maximum of 450 euros. The new service should encourage more couples to have children, also because of the low birth rates in Germany. In addition, it should improve the compatibility of family and work, since parental allowance can also be drawn as a supplement if mothers or fathers work part-time after the birth. The aim was also to encourage more fathers to take a career break for their children.
What should change now?
Parents with high incomes should no longer be entitled to parental allowance. From a taxable income of 150,000 euros for a couple, the benefit should no longer be available. This is the income after deduction of tax allowances, special expenses and other factors. It can be found on the tax assessment notice. According to estimates by the Federal Ministry for Family Affairs, a couple with 150,000 euros in taxable income has an annual gross income of around 180,000 euros. The limit had already been lowered in 2020 by the previous red-black government from 500,000 to 300,000 euros.
How many parents could be affected by the cut?
According to Federal Family Minister Lisa Paus (Greens), there could be around 60,000 families who would no longer be entitled to parental allowance. The Institute of the German Economy in Cologne (IW) comes to a much higher number in its own calculations, as it announced. According to this, there were 435,000 couples living in Germany in 2020 who could potentially have children and who could be excluded from parental allowance in the future because of their high income.
The total figures: According to the Federal Statistical Office, a good 1.8 million people received parental allowance last year, the majority of them women (almost 1.4 million).
How are the reactions?
There is a lot of criticism. The 150,000 euro limit is low. Two academics have already achieved this full-time, even without top positions, according to the IW. The plans noticeably restricted the options for many families, especially in large cities with high living costs, said Union faction leader Friedrich Merz (CDU). There is also rejection from the trade union side: IG Metall calls the project a big mistake. The coalition is thus pushing many women out of working life and back into the traditional distribution of roles. The family ministry would have the opportunity to make savings elsewhere, said deputy AfD chairwoman Mariana Harder-Kühnel.
Isn’t there agreement along the lines of: It’s good that only the wealthy are cut back?
Only a little in public. The social association VdK let it be known that it supports the plans. “But we would like the saved sum of around 290 million in the household to be used to finance other family benefits instead of simply making cutbacks,” said VdK President Verena Bentele “Welt”.
Is it already clear whether the cut will really happen?
No. After the cabinet decision on the draft budget for next year, it is now going to the Bundestag for deliberation. There are usually some significant changes there. In view of the great public criticism on the subject of parental allowance, the last word may not yet have been spoken. The Bundestag should then decide on the budget at the beginning of December.
Source: Stern
I have been working in the news industry for over 6 years, first as a reporter and now as an editor. I have covered politics extensively, and my work has appeared in major newspapers and online news outlets around the world. In addition to my writing, I also contribute regularly to 24 Hours World.
