Germany's upper house blocks key welfare reform

The upper house of the German parliament on Wednesday put on hold government legislation to put more money into the pockets of people drawing state benefits. 

The measure to provide a more generous basic income to certain groups claiming unemployment benefits was blocked by the conservative opposition. 

What's the debate?

Planned changes — approved by the lower house, the Bundestag — would introduce Bürgergeld, or "citizens' money," in place of Germany's current Hartz IV system.

That system, which sanctions people who reject job offers, was introduced in 2005 by the government of Social Democrat Chancellor Gerhard Schröder. However, it has long been criticized by many on the left as being too harsh, with some experts claiming the benefits are insufficient to cover basic living costs.

The Bürgergeld system would include a more generous sum of money for recipients. It would also place less pressure on the jobless to find work within the first six months of receiving the benefit.

Conservatives in the Bundesrat, the members of which reflect the political power balance in all of Germany's 16 states, argued that the new system would be too generous. They say low-income earners will have less money than those benefiting from the changes, something that the government rejects.

"Our welfare state can only function if there are duties as well as rights," said Nicole Hoffmeister, labor minister for the state of Baden-Württemberg, who hails from the conservative Christian Democrats (CDU).

Her counterpart in Bavaria, from the CDU's sister party in the state, said the reform risked sending a signal that it was not worthwhile to work.

What happens now?

The government plans to call on the committee that mediates between the two houses of parliament, with the aim of reaching a compromise.

That plan was announced even before the vote took place by Labor Minister Hubertus Heil, a member of the Social Democrats (SPD), which is the largest party in the three-party governing coalition.

Heil said the reform was aimed at protecting people in existential need and more opportunities to find jobs through qualifications and further training.

The measure is aimed at bridging a skill gap in Germany that is said to be holding back some businesses. 

As well as receiving the boosted basic income, Bürgergeld recipients would be entitled to additional money during vocational training.

rc/fb (dpa, AFP)