German social spending reaches 751 billion euros

Germany currently spends 751 billion euros on social benefits. Spending is rising particularly for unemployment benefit I, care allowances and social assistance.

The Federal Statistical Office has released the latest figures. According to the data, the level of benefits depends on the labour market situation, employment participation, inflation and demographic developments.

Spending is growing particularly strongly on unemployment benefit I, care allowances and social assistance. In contrast, costs for one other benefit are declining slightly.

The authority stresses that political decisions explain only part of the trend. Economic and social factors also play a role.

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Lars Klingbeil presenting the 2027 budget with 204 billion euros in new debt.
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Klingbeil presents 2027 budget draft with 204 billion euros in new debt

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Federal Finance Minister Lars Klingbeil plans nearly 204 billion euros in new debt for 2027. The cabinet is set to approve the draft on Monday.

The Bundestag has approved annual relief of one billion euros for states and municipalities. The law is set to take effect retroactively from 2026 and run until 2029.

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Federal Building Minister Verena Hubertz announced cuts that will affect all recipients. One third of households could lose eligibility.

On Labour Day, German unions announced strong resistance to planned cuts in pensions, healthcare, and social benefits. DGB leader Yasmin Fahimi warned of societal conflicts. Over 366,000 people attended rallies.

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The government approved on Tuesday a non-financial spending limit of 226.032 million euros, 6.6% higher than the previous year, to draft the most expansive state budgets of the term.

A research team has found that cash creates economic value nearly three times higher than the costs it generates.

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The German federal government under Finance Minister Lars Klingbeil (SPD) failed to agree with the Union on budget savings. Instead, taxes on alcohol, tobacco, and cryptocurrencies are set to rise, with new levies on sugar and plastic. The measures appear in the 2027 budget draft to be presented to the cabinet on Wednesday.

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