The planned overhaul of Germany’s citizen’s allowance (Bürgergeld) system is facing significant political hurdles, with key figures within the ruling CDU pushing for a bundled legislative package that includes pro-business measures. Parliamentary State Secretary Gitta Connemann, a prominent voice within the Ministry for Economic Affairs, has indicated that the reform will only proceed alongside revisions to short-time work benefits and the preservation of the Mittelstand clause – a provision safeguarding the interests of small and medium-sized enterprises.
Sources suggest that Economics Minister Katharina Reiche herself has reportedly raised objections to the standalone citizen’s allowance reform just hours before today’s cabinet meeting, signaling a deepening rift within the coalition government. Connemann emphasized that the reforms are inextricably linked, stating the citizen’s allowance debate is intertwined with the future of short-time work regulations.
The push for integration extends to the protection of the Mittelstand clause, a long-standing provision intended to ensure fair access to building permits for smaller businesses. Connemann expressed concern that some within the SPD are attempting to undermine this clause, potentially to the detriment of Germany’s vital SME sector, disproportionately affected by insolvency risks. She warned that any move to marginalize the Mittelstand clause would be a serious misstep.
Furthermore, Connemann conveyed a sense of urgency regarding the overall health of the German economy, accusing some within the government of underestimating the severity of the situation. She characterized Germany’s economic predicament as a “severe pneumonia” rather than a minor ailment and called for “hard doses of medication” including reductions in social security contributions. While acknowledging progress on issues like grid fees, gas price levies and electricity taxes, she insisted that significantly more action is needed to avert a deeper crisis. The expectation is for a unified stance across all governing factions to address the challenges effectively, especially concerning those measures aimed at supporting businesses and safeguarding the Mittelstand.
