The German government has announced its budget for Basic Child Allowance (Kindergrundsicherung). From 2025, Kindergrundsicherung will replace four different child benefits as one bundle payment, but it won’t necessarily mean more financial support for families.

German government formally announces scheme to replace Kindergeld

At a press conference on August 28, Federal Minister for Family Affairs Lisa Paus (Greens) and Finance Minister Christian Lindner (FDP) announced that the coalition government has now agreed on a budget for Germany’s new Basic Child Allowance.

The announcement comes after months of heated discussions between Paus and Lindner, which have ended in a significant compromise for Paus. The Greens minister initially wanted to increase the overall budget by 12 billion euros, a figure which Lindner has managed to whittle down to just 2,4 billion. Speaking at the press conference, Paus said parts of the negotiation process had been “very difficult”.

While presenting the budget increase of 2,4 billion, the pair agreed only that the discussions had been “constructive”. Lindner added that, in his opinion, the new Basic Child Allowance system was the only major social reform that the coalition government could afford to push through in the coming years.

Multiple child welfare organisations in Germany have called the reform disappointing. Speaking to the dpa, President of the Child Protection Association (Kinderschutzbund) Sabine Andresen, said that the new policy was “lacking in courage”. In a press release on its website, Deutsches Kinderhilfswerk said that the end product of the negotiations was far from what the coalition had initially promised when the policy was first announced and not one that could hope to “comprehensively and sustainably eliminate child poverty in Germany”.

How is Kindergrundsicherung different from Kindergeld?

So when the new system is introduced in 2025, how will Kindergrunsicherung differ from the child benefits currently available in Germany?

At the moment, a monthly Kindergeld payment is given to all parents in Germany, regardless of their income, to ensure that their children’s basic needs are covered up to the age of 18. As of 2023, the amount is fixed at 250 euros per month per child, no matter how many children you have or your income.

As well as child benefit, certain parents are entitled to claim Kinderzuschlag, a supplementary child allowance (currently up to 250 euros per month) for each unmarried child who is under the age of 25 and lives in their household. This benefit is means-tested and eligibility is calculated individually by the Family Benefits Office.

At the moment, children whose parents receive citizens’ allowance (Bürgergeld) or other social benefits are entitled to further supplementary payments on top of Kindergeld and Kinderzuschlag.

With the introduction of Kindergrundsicherung, Paus wants to simplify this complicated system. The Greens politician believes that because there are so many paths to claiming different kinds of benefits, people are less likely to understand which payments they can claim for their children.

For that reason, Kindergrundsicherung will combine the existing benefits. It will consist of just two components; one standard payment for all children and one payment that will vary depending on parental income and the child’s age. As it stands, Paus has not announced whether the introduction of Kindergrundsicherung will mean that families will receive more money each month.

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