Examining the Impact and Controversy Surrounding the Proposed Cap on Parental Allowance

2023-07-07 20:00:42

The federal government wants to cap parental allowance: If things go as planned, couples with taxable income of EUR 150,000 or more will no longer receive parental allowance.

When this news broke earlier this week, there was great outrage. Parents commented on social networks, a petition already received more than half a million signatures on Friday evening. Elke Hannack, Vice-Chairman of the German Trade Union Confederation (DGB), also criticized the decision with sharp words: “Cuting the parental allowance now is nothing more than gender equality policy madness,” she said – a proposal “without rhyme or reason”. She sees the equality of women and men, whose goal was parental allowance originally, in danger. But there are other voices too. One belongs to the sociologist Jutta Allmendinger.

Sociologist sees imbalance in perception in society

Allmendinger is a member of the Bavarian Academy of Sciences, among others, and researches as a professor on the subject of gender equality, especially in the world of work. “The fact that regarding half a million people have signed this petition – so much more than are affected by it – that’s something that’s really on my mind these days,” she says. The proposal to cut parental benefits for richer families is interpreted in society as a withdrawal of social benefits for everyone. “But the fact that this only applies to the richer is pushed away,” says the sociologist.

Despite parental allowance, the distribution of care work is rarely equal

Affected are couples who are in the top five percent of the income distribution and thus relatively few. “No one will say, not even those affected, that this will plunge them into poverty or precarious conditions,” says Allmendinger. In her opinion, the parental allowance – as it is currently designed – is not the key to more equality anyway.

When parental allowance was introduced in 2007, one of the goals was to encourage more well-earning men to take parental leave and look following their children for longer. But the goal of distributing gainful employment and care work equally between the partners has not been realized, the sociologist notes. “There’s still a lot of room for improvement.” According to her, 98 percent of women receive parental allowance – for around 13 months. For men, on the other hand, it is only 44 percent – and they only take care of the offspring for an average of three months.

Consequences for couples earning regarding the same

Among the very well-earning men, the group of those who take parental leave is even smaller. The parental allowance should have been an incentive for managers, editors-in-chief and politicians. “In this respect, I ask myself why we are now making exactly this argument when we have not actually been able to identify this group as a game changer since the introduction of parental allowance in 2007,” says Allmendinger.

It will be exciting with partners who earn regarding the same: “One might almost speculate that the women concerned now have greater bargaining power. They might say: ‘I get nothing, you get nothing, so let’s split it up right now. ‘” The actual consequences are not yet foreseeable.

Allmendinger: Capping “appropriate” – but not immediately

In view of the options that Finance Minister Lindner (FDP) gave to Family Minister Paus (Greens) – namely a general reduction in parental allowance – sociologist Allmendinger considers the cap to be “appropriate”. “As Ms. Paus, I would probably have decided that if I had to save, I’d do it with high-income families.” On the other hand, she considers the immediate implementation of the caps on parental allowance to be wrong. A transitional period is needed so that the parents concerned can adjust to it.

More mandatory months of parental leave for fathers?

In the scientist’s opinion, in order for parental allowance to actually become an instrument for more gender equality, politics would have to turn a different wheel: by motivating fathers to take more months of parental leave. Allmendinger’s idea: Families should only be paid for the full 14 months if the father also looks following the child for at least four or five months – and not just two as is currently the case. In her opinion, a bonus with an equal distribution of the months of parental leave might also lead to success.

Sociologist worries regarding those who are not heard

According to the sociologist, the fact that more than half a million people have already joined the petition to save parental allowance for higher earners shows that this group has great network power. “They are much more likely to defend themselves than the many people who don’t get the public voice they really need. And that’s a dangerous process that we’re experiencing here,” says the sociologist. For example, an ongoing petition by low-income parents to raise the minimum parental allowance of 300 euros collected far fewer signatures. Around three million children are currently living in poverty.

Family father is for parental allowance – and for basic child security

Reinhard Rucker became a father a few years ago and took seven months of parental leave at the time, as did his wife. The 35-year-old says that the topic of capping parental benefits is a source of excitement, including at work. Together with other colleagues, he is involved in a company fathers’ network. He himself would probably not be affected by the cut, he says, but: “I see the danger that there will be a step backwards in terms of equality.”

Like Allmendinger, Rucker also sees a need to catch up when it comes to basic child security, i.e. support for children growing up in poverty. He just doesn’t understand why money is being saved on children or parents at all. “I think that spouse splitting should be abolished, there would probably be a lot more money to be made.”

Sociologist Jutta Allmendinger takes a similar view. They found that this might easily save billions. “But that’s a no-no for the coalition partner FDP.”

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