Concerns are mounting over the increasing shift of responsibilities onto Germany’s social insurance system, with the President of the social association VdK, Verena Bentele, voicing strong criticism of current policy trends. Bentele argues that social policy is struggling to keep pace with new challenges, exacerbated by a perceived prioritization of other spending areas while social provisions are scrutinized for perceived inefficiencies.
“The notion of a bloated welfare state requiring cuts is a myth that needs to be dispelled” Bentele stated in an interview with the Mediengruppe Bayern. She highlighted that the social security contribution rate remains consistently around 30 percent, demonstrating a relative stability over recent decades.
Furthermore, Bentele emphasized that Germany’s position in international comparisons doesn’t reflect a lavish social spending program. According to her, the nation ranks seventh out of 18 wealthy OECD countries regarding state social expenditure as a percentage of gross domestic product.
Bentele contends that the core issue isn’t an imbalance in social costs themselves, but rather a skewed political debate and media portrayal. In recent years, an increasing number of broader societal tasks, ideally financed through general taxation, have been delegated to social insurance institutions, driving up contribution rates. She estimates that properly funding these obligations through the federal budget could potentially reduce social security contributions by more than four percentage points.
The VdK is advocating for a more equitable tax policy to address this situation. Their proposal involves taxing assets exceeding five million euros at a rate of one percent and those above 100 million euros at two percent. The association estimates that this measure could generate approximately 40 billion euros in revenue, affecting roughly 300,000 high-net-worth individuals.
