Strong Welfare State
Germany has one of the world’s most comprehensive social security systems. As in other developed democracies, spending on the welfare state Welfare state The principle of the welfare state is enshrined in Article 20 of the Basic Law and cannot be rescinded, even if the Basic Law is changed. In this way the Basic Law commits the state to protect, in addition to their freedom, the natural bases of life of its citizens. Each individual, however, also… Read more › represents the largest individual item of public spending. Social security expenditure amounted to some 1.34 trillion euros in 2024 - equivalent to 31.2 percent of GDP.
How did Germany’s welfare state come about?
The tradition of the state welfare system goes back to the age of industrialisation in Germany in the second half of the 19th Century and is associated with the then Reich Chancellor, Otto von Bismarck. It was under his chancellorship that mandatory health insurance Health insurance Almost all citizens in Germany have health insurance, whether as a compulsory member of the statutory health insurance scheme (90 percent) or a private health insurance scheme (10 percent). The health insurance companies cover the cost of medical treatment, medication, hospitalization and… Read more › was first introduced in 1883. Over the following years, legislation was expanded that would form the basic principles of the welfare state Welfare state The principle of the welfare state is enshrined in Article 20 of the Basic Law and cannot be rescinded, even if the Basic Law is changed. In this way the Basic Law commits the state to protect, in addition to their freedom, the natural bases of life of its citizens. Each individual, however, also… Read more › . The Basic Law The Basic Law The Basic Law determines that Germany is a constitutional state: All state authorities are subject to judicial control. Section 1 of the Basic Law is of particular relevance. It stipulates that respect for human dignity is the most important aspect of the constitution: “Human dignity shall be… Read more › further enshrines the principle of the welfare state for the Federal Republic of Germany. According to the Basic Law The Basic Law The Basic Law determines that Germany is a constitutional state: All state authorities are subject to judicial control. Section 1 of the Basic Law is of particular relevance. It stipulates that respect for human dignity is the most important aspect of the constitution: “Human dignity shall be… Read more › , political leaders and society must continually negotiate and update the form that the welfare state takes. Demographic change is making assimilation necessary.
Which forms of insurance protect people in Germany?
Various forms of basic insurance for health, pensions, accidents, nursing care and unemployment provide a tightly-woven network protecting members of the public against threats to critical aspects of their lives. The network of welfare support includes a basic income for pensioners and those permanently unable to work, along with tax benefits such as the family allowance. Families receive child benefit payments each month.
How are pensions dealt with in Germany?
The pension package that entered into force in 2014 especially improves the situation of elderly people. The reform saw the introduction, among other things, of the full pension from 63 years of age (for those born in or before 1952) and the so-called “mother’s pension”, which acknowledges mothers’ work in raising children. Women who brought up children born before 1992 were not able to access the childcare support available to parents today, which reduced their opportunities in the world of work. The mother’s pension acknowledges the work they did in bringing up children.
Why are pensions stable in Germany?
In 2025, a law was adopted to stabilise the pension level and to fully compensate for periods spent raising children (known as the “2025 pension package”). It will ensure that the pension level does not fall below 48 percent until 2031.
A basic pension scheme was introduced in early 2021. Anyone who has paid pension insurance Pension insurance The statutory pension insurance is the most important pillar of old-age provisions. Its financing is split: The monthly contributions paid by employees and employers pay the pensions of those currently in retirement. Through their contributions, those insured acquire some rights when they… Read more › for at least 33 years but had low earnings - this applies in many cases to women - will receive an additional payment in future.
Is health insurance compulsory in Germany?
Health insurance Health insurance Almost all citizens in Germany have health insurance, whether as a compulsory member of the statutory health insurance scheme (90 percent) or a private health insurance scheme (10 percent). The health insurance companies cover the cost of medical treatment, medication, hospitalization and… Read more › cover is a legal requirement in Germany. Medical care is provided through a wide range of services including hospitals, medical practices and rehabilitation clinics.
