As of: January 21, 2024, 11:12 a.m
By: Nils Hinsberger
Comments
Press
Split
Does work have to be worth it again?
Opposition politicians believe that a higher citizen's allowance would reduce incentives to work.
Now a new study has come out.
Munich – The traffic light coalition’s citizens’ money has come under massive criticism.
Fears are expressed from all sides that excessive social benefits would reduce incentives to work.
Above all, CDU leader Friedrich Merz, who recently warned of “more unemployment in the future,” should the federal government increase social benefits again, as the
Rheinische Post
reports.
But even within the coalition, not everyone seems to be satisfied with the reform of unemployment benefits.
During his speech at the farmers' protests, Finance Minister Christian Lindner (FDP) spoke of the fact that "people get money for doing nothing."
However, this brought him neither the approval of the farmers nor the sympathy of social associations.
A family of four could expect to receive a total of 3,200 euros per month, according to Merz.
According to the CDU leader, this amount would raise the question of whether it is still worth pursuing employment.
But is this statement actually true?
A new study by the
ifo Institute
However, it showed that “despite the significant increase in the standard rates for citizens’ benefit, there is still a noticeable wage gap”.
Microsimulation model calculates “wage gap requirement” after citizen benefit increase
The introduction to the study states that after the announcement of the increase in citizens' allowance, demands were immediately made for compliance with the “wage gap requirement”.
The commandment states that there must be a difference in “disposable income” between the income of those who are employed and those who are not.
Disposable income is the money that a household can freely use for consumption, savings or investments, according to the Federal Agency for Civic Education.
In order to show the differences between the types of income, a simulation calculates how much money the different households have left “after deducting taxes, social security contributions, rent and heating costs”.
The various increases in social benefits, such as the increase in the basic allowance and child allowance, were also taken into account in the calculation.
Want to stop the increase in citizens' money: Federal Finance Minister Christian Lindner (FDP) and CDU leader Friedrich Merz (l).
© Political Moments/Imago
Wage gap continues in the event of an increase in citizen's benefits
In order to get an overview of different household designs, the simulation was carried out for four different households.
As the study shows, the wage gap changes depending on the household and income situation.
My news
“If word gets around”: Turkish community warns of consequences of naturalization reforms
Pistorius warns Germany of war with Russia in “five to eight years” read
Russia is probably planning new tactics in the Ukraine war: despite historical failures
Read how farmers make fun of Ricarda Lang with a bad poster
Fuss about Baerbock's alleged luxury watch: husband revealed the model - it's that cheap
New survey slap for Scholz: SPD halved - Wagenknecht party read for the first time
As an example, the document cites the household of a single person with an income at the minimum wage level with average rent prices.
The result: According to the study, those who work for a minimum wage have 457 euros more in disposable income per month.
If rental prices are high, the difference would be reduced to 348 euros.
This is due to “the postponement of the cheaper test between citizens’ benefit and housing benefit”.
This picture appears to be quite consistent “for all the constellations shown”.
“The wage gap is several hundred euros for all households examined,” says the study.
The investigation thus contradicts the claims of politicians such as CSU General Secretary Martin Huber, who demanded at the “working breakfast” on the CDU website that the wage gap requirement must apply again.
Study suggests system reform
“It is clear that despite the significant increase in the standard rates for citizens’ benefit, there is still a noticeable wage gap,” is how the study summarizes the results found.
However, this does not eliminate the problem of work incentives.
The authors suggest that although a system reform is necessary, social benefits do not have to be cut.
In this way, the “low incentives to expand existing employment” could be increased without contradicting an increase in citizens’ allowance.
(nhi)