Goodbye Bürgergeld: Germany's 'citizens' income' changes name and becomes stricter

The Bürgergeld is currently provided to about 5.2 million people (1.4 million are children under the age of 15). The cost exceeds EUR 50 billion, adding up the expenditure for the monthly allowance (up to EUR 563), contributions for rent and heating, other support measures and the costs of the administrative machine.

Above all, Germany needs to mobilise its workforce: although unemployment remains relatively low (6 per cent), almost three million people are unemployed, a threshold not reached in ten years. At the same time, companies are struggling to find staff, both qualified and unqualified: in November there were over 620,000 vacancies. And the squeeze on immigration complicates matters.

The Bürgergeld reform should come into force on 1 July 2026. The measure will first have to pass the scrutiny of parliament, where the red-black coalition managed to overcome two very challenging hurdles in recent weeks, such as the reform of the military and that of the pensions. In this case, the coalition risked going under due to an internal faction within the Chancellor's party, the Cdu.

The autumn of reforms, announced by Friedrich Merz to shake up the German economy, is turning out to be very grey: the clashes between government allies are beginning to remind one of the quarrelsome Semaphore coalition (between Social Democrats, Greens and Liberals), paralysed by continuous conflict and eventually imploded.

In addition to the polls, which punish the government parties and reward Alternative für Deutschland and Linke, the climate of mistrust is also reflected in the expectations of companies: the most recent of the parameters measuring them, the Ifo index, fell again in December. In a recent interview with the Süddeutsche Zeitung, the president of the German Confederation of German Industry, Peter Leibinger, stated that 'many in the companies are disappointed as never before. The climate is extremely negative, sometimes aggressive'.