Germany Table of Contents
Social assistance is provided to persons who, for any of a number of reasons, are unable to provide themselves with a decent standard of living. In 1991 some 4.2 million persons received various forms of social assistance. In the same year, the most important reasons that people needed social assistance were unemployment (34 percent; social assistance is paid once unemployment pay runs out), pensions or incomes too small to allow their recipients a decent standard of living (11 and 7 percent, respectively), refusal of divorced fathers to pay child support (11 percent), and sickness (6 percent). Half of all recipients of social assistance are single elderly women. Foreigners residing in Germany also receive social assistance at a higher than average rate because they are more likely to be unemployed or earn low incomes.
Unlike the benefits provided by social insurance programs, social assistance is funded by taxes and is not determined by previous contributions. Social assistance is means tested, and recipients generally must have exhausted their savings. The incomes of a recipient's close relatives (parents and children) may also be considered when assessing the provision of social assistance. In the mid-1990s, social assistance for the head of household amounted to about DM500 a month in the old Lšnder ; 80 percent of this amount was allocated for the spouse, and 50 to 90 percent of this amount was allocated for the children, depending on their ages. In addition to these benefits, social assistance can cover housing costs, medical care, clothing, winter heating, and many other expenses.
In addition to social assistance, Germany's social welfare system provides many other tax-funded benefits. The most widely paid benefit is that of the child allowance. It is paid to parents of all income levels to lessen the burden of raising children. Benefits are generally paid until the child reaches the age of sixteen and thereafter up to the age of twenty-seven if the child is receiving an education. In the mid-1990s, DM70 a month was paid for the first child, DM130 for the second, DM220 for the third, and DM240 for the fourth and subsequent children. Upper-income parents receive smaller amounts. Child benefits are tax exempt. Taxpayers also have an annual income tax exemption of DM4,104 for each dependent child.
Since 1986 payments for child rearing have also been made to parents who are either unemployed or working only up to nineteen hours per week. In 1994 these payments amounted to DM600 a month per child for the first six months of the child's life; after this age, household income was considered. Payments continue until the child's second birthday. Beginning in 1994, a single parent with a net annual income of more than DM75,000 and a couple with a net annual income of more than DM100,000 were no longer eligible to receive this benefit.
A single parent raising a child and receiving inadequate financial support from the other parent is eligible to receive maintenance payments up to a child's twelfth birthday for a maximum period of seventy-two months. In 1994 in the old Lšnder , these payments could amount to as much as DM291 a month for children up to age six and DM353 a month for children between the ages of six and twelve.
Families and single individuals can also receive payments to help them with housing expenses if their incomes are insufficient to afford decent shelter. Unlike housing aid provided through social assistance, aid of this nature does not require that recipients exhaust their savings or lack close relatives to assist them.
The disabled are also served by a broad range of medical and vocational programs designed to provide them with humane living conditions. Statutory social insurance programs are responsible for meeting the various needs of their members who become disabled. In addition, government agencies at the federal, Land , and local levels seek to provide employment and help with special housing and transportation provisions. Employment of the disabled is furthered by federal legislation that requires firms employing more than fifteen persons to reserve 6 percent of positions for the disabled or to make annual compensatory payments. In 1994 Germany had nearly 600 sheltered workplaces able to provide special employment for about 140,000 disabled persons unable to find employment in the general economy.
Since 1995 German residents have been obliged to join a new social insurance program that arranges for its members' future need for long-term nursing care. Those with public health insurance will continue with that insurance; those with private health insurance are obliged to secure a new insurance policy to arrange long-term nursing care. The new insurance program will initially cover the expenses of long-term nursing provided at home; monthly benefits, in some special cases, will go up to DM3,750 but usually will be set at much lower levels depending on the kind of nursing care provided and the condition of the insured person's health. Some benefits will be provided in kind, such as visits by health care professionals to the home. Some benefits will be cash payments to friends or relatives who provide nonprofessional nursing care. Beginning in mid-1996, long-term institutional care will also be covered.
Until this program was instituted, the lack of long-term nursing care was seen as the single most important shortcoming in the country's system of social welfare. One effect of this shortcoming was that patients who should have been receiving nursing care at home or in a nursing institution remained instead in hospitals, a more expensive form of treatment. As of late 1994, officials had set an initial contribution of 1 percent of incomes up to DM68,400 a year in the old Lšnder and DM53,100 in the new Lšnder , with the employee and the employer each paying half. Part of the costs of long-term nursing care may in the future be covered by abolishing a public holiday that always falls on a workday. To cover the cost of long-term institutional nursing care, the contribution rate will increase to 1.7 percent in mid-1996. The great expense of this benefit may require the abolition of a second public holiday.
The administration of the nursing care insurance program is unique. It overlaps somewhat that of the sickness funds but will also include many federal, Land , and local agencies. In fact, the program will involve more implementors than all other social insurance programs combined. Implementation problems arise primarily from different entitlements and services provided through social assistance, or social aid, and by nursing care insurance. Problems also stem from differing evaluations by sickness-funds medical experts about who needs care and how much and what kind of nursing care is needed throughout Germany.
Data as of August 1995
Germany Table of Contents