Spending billions on citizens' funds: is it ethical to cut aid for Ukrainians?
The German government is planning to reduce social benefit entitlements for newly arriving Ukrainian refugees starting from April 1, 2025. Instead of receiving the Citizen's Allowance (Bürgergeld), these refugees will receive benefits under the Asylum Seekers’ Benefits Act, which are lower—estimated at about 100 euros less per month per refugee.
This reform is part of Germany’s efforts to reduce welfare spending related to the high number of Ukrainian refugees, currently estimated at around 1.25 million in Germany as of mid-2025. The draft law still requires cabinet and parliamentary approval and is expected to come into effect by the end of 2025.
Economist Enzo Weber from the Institute for Employment Research IAB emphasizes that basic security offers advice, placement, and qualification, which refugees would have less of if they were not in the system. However, he agrees with the point that the integration of refugees into the labor market takes time.
The Federal Minister of Economics, Katherina Reiche, expressed a general view: "It must be ensured that working is more worthwhile than staying at home."
The German Cities and Municipalities Association stated that municipalities cannot bear the costs for Ukrainian refugees themselves and that the federal and state governments would have to fully cover the expenses if there were a change.
The planned citizens' allowance reform will also bring savings, according to the responsible Social Ministry. However, Dirk Wiese, an SPD politician, disagreed with the idea of saving costs by withdrawing citizens' allowance for Ukrainian refugees, stating that the administrative burden on municipalities would be enormous.
The employee wing of the union strongly opposes Bavarian Minister-President Markus Söder's proposal to withdraw citizens' allowance for all refugees from Ukraine and only grant them the lower asylum-seeker benefits. The SPD leader, Lars Klingbeil, also voiced his opposition, stating that Söder's proposal "does not contribute, in my opinion, to moving forward together in the coalition."
The Ministry of Social Affairs is confident that the planned innovations will bring savings overall from 2026. The amount is open. The ministry spokeswoman also noted that a decrease in benefit recipients is already noticeable in the citizen's income. More people are being integrated into the labor market. The redesign of basic security will further strengthen placement in work, the spokeswoman emphasized.
The reform is separate from Germany’s wider pension reforms which involve raising contributions and adjusting pension levels but do not specifically address refugee benefits. Welfare payments overall increased significantly in 2024, with Ukrainian nationals receiving €6.3 billion that year, contributing to discussions about the sustainability of the system.
Sources:
[1] German pension reform
[2] German citizens' allowance reform for Ukrainian refugees
[3] German pension reform
[4] Welfare payments in Germany
- The debate in Germany's political sphere extends beyond the citizens' allowance reform for Ukrainian refugees, as discussions about finance and business also encompass pension reforms, aiming to raise contributions and adjust pension levels, yet not specifically addressing refugee benefits.
- The German government's financial decisions, such as the reformation of citizens' allowance for Ukrainian refugees and the pension reform, have significant implications for the business sector, as these changes could impact the overall economy and the labor market integration of refuges, a key factor in general-news headlines.
