Zero increase despite falling inflation – Nachrichten AG

The plans for the citizen's allowance are taking an unexpected turn: next year, the monthly payments will not be increased. Hubertus Heil, the SPD's Federal Minister of Labor, commented on this decision in an interview with the television channel RTL and spoke of a so-called “zero increase”. This means that the existing standard rates, which have been the basis for social benefits since 2024, will remain unchanged in 2025.

Heil explained that the legally established calculations of standard needs, which must take current inflation rates into account, led to this decision. With an inflation rate of just 1.9 percent, an increase in the citizen's allowance is not justified. “And that is right,” he added. Nevertheless, the minister stressed the need not to support people and pointed out that the citizen's allowance is designed as a subsistence minimum: “No more, but also no less.”

Background to the zero round

The decision not to increase the amounts for the citizen's allowance is in the context of the last increase in 2024, which was more than twelve percent. In retrospect, this increase turned out to be excessive, as inflation was overestimated in the predicted cases. As a result, the freeze has been on the horizon since the end of last year. From January 1, 2025, people living alone will continue to receive 563 euros per month, while partners and children will receive slightly less.

A surprising comment came from Marco Buschmann, the FDP's Federal Minister of Justice, who even suggested a possible reduction in the citizen's allowance. This shows that there are different views within the coalition about the future of the social welfare system. The debate about the citizen's allowance is therefore not just a question of money, but also a political dispute. The SPD wanted to distance itself from the unpopular Hartz IV by introducing the citizen's allowance, but the strategy does not seem to be generating the desired support.

Criticism of this policy is not new. Against the backdrop of the last election campaigns, the SPD has found itself in a difficult situation. The hoped-for support from voters has been slow to materialize, and the strategy of winning back lost voters with the citizen's allowance seems to have stalled. Doctors and social workers complain about the inadequate support for those in need and warn of the negative consequences of these political decisions.

With a keen sense of the current economic conditions, the government seems to have to find a balance between the needs of citizens and tax opportunities. What was initially seen as a solution to the Hartz IV problem now raises questions about whether the support is really sufficient and whether the political promises can be kept. The coming months will be crucial to see how the discussion about the citizen's allowance develops and whether citizens will accept this decision.