The German government has initiated its planned reform of parental allowance (Elterngeld). The cabinet approved the proposal on Thursday through a so-called written circulation procedure, Deputy Government Spokesperson Sebastian Hille said in Berlin on Friday. The reform is intended to make parental allowance “even more equal between partners, more attractive and simpler”, he said. The proposal will now be considered by the Bundestag.
Under the proposed changes, the minimum payment for basic parental allowance (Basiselterngeld) would increase from €300 to €330, while the maximum payment would rise from €1,800 to €1,900.
The government plans to retain the maximum payment period of 14 months. However, in future, four months would be reserved for each parent, compared with the current two months per parent. The remaining six months could be divided flexibly between the parents.
The payment rate would also change. For the four reserved months, each parent would receive 80 per cent of their previous net income, up from the current 65 per cent. However, for the remaining parental allowance months, the payment rate would fall to 50 per cent of previous net income.
There would be no changes for single parents, who would continue to be eligible for up to 14 months of parental allowance. The reform is scheduled to come into force in November 2027.
The changes would create “a real incentive for a more equal division of parental allowance months, because it will generally make participation more attractive for fathers”, Deputy Government Spokesperson Hille said. He also emphasised that the planned simplifications would make the application process easier for parents and speed up processing by parental allowance offices.
Federal Family Minister Karin Prien (CDU) had initially planned to reduce the total parental allowance payment period from 14 to 12 months. The proposal was prompted by strict spending reduction requirements imposed by Finance Minister Lars Klingbeil (SPD). However, the plans faced sharp criticism. At the end of October, Prien announced that she would abandon the proposed reduction.
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