The German government is set to tighten several rules for people receiving the long-term unemployment benefit, Bürgergeld. This is what we know so far about the planned changes.

What is Bürgergeld?

The German coalition government has now agreed on its 2025 budget. Alongside changes to tax rates, halving integration course funding and upping defence spending, the Jobcentre (Arbeitsamt) will implement new rules for Bürgergeld recipients.

Bürgergeld (citizens’ allowance) is a basic subsistence benefit separate from Germany’s main unemployment benefit (Arbeitslosengeld). If your eligibility for Arbeitslosengeld expires, you are not eligible to receive it in the first place, or if you cannot ensure your subsistence adequately from all your wages or assets, you can apply for Bürgergeld. Sometimes, the benefit is also given as an income supplement for low-earners.

Since January 2024, the monthly Bürgergeld payment for single people has been 563 euros. The benefit replaced the infamous Hartz IV payment in 2022 and was introduced as a fairer benefits system with fewer sanctions and more support for recipients to find long-term work. However, since its introduction payments have already been found to be insufficient to cover recipients’ utility bills.

The coalition has now formally agreed on the draft budget. However, the budget will face a vote in the Bundestag on July 24 before it is officially confirmed. In the meantime, these are the changes which are planned:

Bürgergeld recipients to report to Jobcentre more regularly

With the new rules, Bürgergeld recipients who have been unemployed for over a year will have to report to the Jobcentre more regularly.

If they are “available to the labour market at short notice” for example they do not have dependents or are in further education, long-term recipients will be expected to attend a monthly meeting at the Jobcentre.

"A high, binding contact density between recipients of the Bürgergeld and the authorities is important for successful placement," the German Finance Ministry has said.

Cash-in-hand work will be penalised more harshly

Since the Bürgergeld payment of 563 euros per month isn’t enough to pay rent, bills and necessities for most people in Germany, recipients can work limited hours while receiving Bürgergeld, but this work must be declared to the Jobcentre.

Recipients who have not reported their work and are found to be working will now face a 30 percent benefit reduction for three months. Jobcentre employees will also be newly obligated to report cases to customs if they suspect that a Bürgergeld recipient is working informally.

Existing laws already rule that Bürgergeld recipients in undeclared paid work are committing social fraud. Depending on the case, anyone found to be committing social fraud may face a fine or imprisonment.

Jobseekers will need “valid reason” to reject work or face sanctions

Under the new rules, Bürgergeld recipients who refuse to take up reasonable work or training without a “valid reason” will face having their benefits reduced by 30 percent for three months.

Longer work commute times will be acceptable for the Jobcentre

Jobseekers will be expected to accept jobs with a longer commuting time, within 50 kilometres of their house. The coalition has decided that a daily commute of three hours total is acceptable if shifts are six hours or longer. If a position offers fewer than six working hours per day, the coalition has said a total commute time of two and a half hours is acceptable.

There may be an exception to these new rules if Bürgergeld recipients have dependents who need care.

Bürgergeld recipients will have to use their own assets sooner

In Germany, unemployed people can still claim Arbeitslosengeld or Bürgergeld even if they have assets; including cash, savings, savings bonds, securities, items like vehicles or jewellery, endowment insurance or real estate.

In the 12 months of receiving Bürgergeld, assets are only taken into account if they are considered “substantial” (worth more than 40.000 euros for a single person, plus 15.000 euros for each additional household member). After this initial period, all assets will be taken into account for determining eligibility.

Under the new budget plan, this grace period will be reduced from 12 months to six months.

Coalition in disagreement about Bürgergeld changes

"To maintain acceptance of the benefits and to get more of those affected into work, it is necessary to strengthen the principle of reciprocity again," the government wrote in its draft budget. However, the draft was not written up without sharp debate between coalition member parties.

The Greens have criticised the plan and the SPD are sceptical. “None of these measures will help us one bit when it comes to integrating people in work,” Greens politician Beate Müller-Gemmeke told the AFP.

Kevin Kühnert’s (SPD) comment to German public broadcasters was more on the nose. Speaking to ARD/ZDF Morgenmagazin the general secretary criticised that the changes were based on an “assumption that there are hundreds of thousands of lazy people on unemployment benefits."

Representing the coalition’s third member party, the FDP, Justice Minister Marco Buschmann said that the planned changes were “socially just”.

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