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Germany Sets Out Tougher Welfare Sanctions and €2 Billion Health Savings Push

Key measures face legal scrutiny, with cabinet and Bundesrat approval still pending.

Overview

  • Coalition leaders plan to replace Bürgergeld with a new Grundsicherung featuring staged penalties for missed Jobcenter appointments: a replacement appointment first, a 30% cut after a second miss, then loss of cash benefits after a third.
  • At the current €563 standard rate for single adults, a 30% cut equals €169 per month, and social associations warn the proposal risks undercutting the constitutionally protected subsistence minimum and worsening poverty and housing stress.
  • The reform blueprint also ends the initial grace period and lowers protected assets for newcomers, triggering immediate checks on housing-cost ‘reasonableness’ that critics say are impractical in a tight rental market.
  • Health Minister Nina Warken’s package to stabilize statutory insurance totals roughly €2 billion—about €1.8 billion from hospitals plus savings in insurer administration and the innovations fund—with GKV leadership welcoming concrete steps as the cabinet readies a Wednesday discussion and opponents caution against hidden benefit cuts.
  • Bund and Länder signaled they will keep care “grades” in the long‑term care insurance but review and simplify benefits to tackle a roughly €2 billion gap, with options under discussion still unsettled and SPD figures rejecting a savings law at the expense of the most vulnerable.