The some 5.5 million recipients of Bürgergeld – formerly known as Hartz IV – will see a significant rise in their monthly income from 2024.

Instead of the current €502 per month, single households will receive €563 from the state – an increase of 12 percent.

Announcing the hikes to welfare payments in Berlin, Labour Minister Hubertus Heil (SPD) described the increase as a “substantial step”.

“Especially in the current crisis and in times of crisis and upheaval, one must be able to rely on the welfare state,” he said. 

At the start of next year, Bürgergeld will also increase for young people and families.

Parents will receive €471 per month rather than €420 per month for teenagers aged 15-18, €390 rather than €348 for every child aged 7-14 and €357 instead of €318 for children aged 6 or under.

As part of the transition from the former Hartz IV system to Bürgergeld, which came into force at the start of 2023, unemployment benefit will be adjusted more rapidly to inflation.

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Last year, consumer prices were on average 7.9 percent higher than they were in 2021, and Germany’s inflation rate currently stands at 6.2 percent.

Under the previous Hartz IV long-term unemployment system, benefits payments rose at a much slower rate than consumer prices. 

As part of the Bürgergeld reform, however, payments will be adjusted in line with inflation from the following year.

‘Poverty rates’

Commenting on the changes, the social association VdK slammed the proposed increase as too little, too late.

“The increase of the standard rates comes much too late in view of the continuing inflation,” said VdK President Verena Bentele. 

The view was echoed by the National Parity Association – a pressure group made up of welfare associations – who said €725 per month would be required to offset the loss of spending power due to inflation.

“These standard rates are and remain poverty rates and miss the reality of people’s lives,” the association said in a statement.

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However, the German Social Welfare Association (SoVD) described the adjustment of Bürgergeld as a “good signal”. 

Speaking to DPA, SoVD president Michaela Engelmeier said the €60 increase would help hundreds of thousands of people in Germany.

The transition to Bürgergeld, which came in January after months of negotiations, was a key reform pledge of the traffic-light coalition government.

It marks a change of tone from the previous Hartz IV system, with long-term unemployment recipients far less likely to be sanctioned for things like missed appointments and a longer grace period in which Bürgergeld claimants can stay in larger apartments without having to move.