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Germany Moves to Tighten Welfare Rules as Klingbeil Unveils Debt-Heavy 2026 Budget

The audit office’s rebuke of the borrowing plan raises pressure for tougher enforcement of benefits.

Overview

  • CDU secretary Carsten Linnemann urges an EU redefinition of the employee concept so a few hours of work no longer qualify for Bürgergeld top-ups, and he proposes guarantor-style liability for employers who hire illegally.
  • Labour Minister Bärbel Bas signals agreement on curbing organized fraud and promises autumn proposals centered on faster data-sharing and a new federal competence center for benefit abuse.
  • Government data show the share of Bürgergeld recipients without a German passport rose to 47.3% in 2023, with jobcenters reporting schemes involving sham contracts, mini-jobs and overpriced housing.
  • Finance Minister Lars Klingbeil presents the 2026 plan with 520.5 billion euros in core spending, 174.3 billion in new borrowing and 126.7 billion in investments, bringing total outlays to roughly 630 billion including special funds.
  • The Bundesrechnungshof and opposition parties criticize the debt load and priorities as Klingbeil pledges reforms, savings and industrial support, with parliamentary scrutiny under way and a final vote targeted for late November.