Germany: Corona Social Protection Measures take effect

To protect citizens from existential hardship due to the economic impact of the coronavirus pandemic, Germany’s Federal Government has put together a package of measures to provide support for the self-employed, workers, families and health workers, among others. A law on the social protection package, passed by both chambers of the federal parliament and signed by the president, enters into force on Saturday, 28 March 2020.

The upper chamber of the federal parliament, the Bundesrat, on Friday approved a package of measures to cushion the social and economic consequences of the corona pandemic for citizens.

The social protection package (Sozialschutz-Paket), as the government calls it, offers public assistance to small businesses and solo entrepreneurs, companies and workers as well as families in difficulties caused by the situation.

The unprecedented public assistance package, which had earlier been approved by the lower chamber of parliament, the Bundestag, on Wednesday, was signed into law immediately after the Bundesrat vote by President Frank-Walter Steinmeier.

 

The €750 billion aid package, which seeks to protect citizens and the economy from the worst effects of the coronavirus outbreak, amends existing regulations and offers, among others, the following reliefs:

Relief for the self-employed

Small business owners and so-called solo entrepreneurs affected by the crisis will have easier access to funds so that their livelihood and accommodation are secured. An assessment of the personal assets of the grant applicants will not be carried out for now when they apply. This is to ensure a speedy application and approval process.

• Businesses with up to five (full-time equivalent) employees can apply for a one-off payment of up to 9,000 euros for a period of three months.
• Businesses with up to ten (full-time equivalent) employees can apply for a one-off payment of up to 15,000 euros for a period of three months.

Solo entrepreneurs (one-person businesses), freelancers and small business owners could receive up to 9,000 euros in grants under the federal scheme.

Help for the elderly and people with reduced earning capacity

The facilities available to small business owners are also available to the elderly and those with reduced earning capacity (Erwerbsgeminderte), since they can also suffer significant income losses due to the crisis.

The reliefs can be applied for from 1 March 2020 to 30 June 2020 – if necessary, the Federal Government can extend them until 31 December 2020.

Easier access to child allowance

Since many families currently experience reduced income due to short-time work or for having to resort to unemployment benefits, they too will receive support.

For this purpose, the regulations governing the grant of child allowance (Kindergeld) is temporarily changed: The income from the past six months should no longer be checked, but only that from the previous month. This will prevent losses resulting from previous short-time work or unemployment.

In addition: A review of the personal assets of the applicants (Vermögensprüfung) is suspended.

Moreover, families who have recently received the highest possible child allowance within an approval period can apply for a one-time extension for six months without a renewed income review (Einkommensprüfung). This means that the benefits can be granted without interruption.

The temporary rule applies for the period from 1 April to 30 September.

 

Support for social service providers

The social service providers in Germany are actively contributing to coping with the effects of the corona epidemic. However, due to the current situation, they too are threatened with serious financial losses and bankruptcy.

To support the social service providers, the Federal Government provides grants to facilities for disabled people, children and adolescents, women, families and senior citizens.

The support is initially available until 30 September 2020 and can be extended until 31 December 2020.

Compensation for parents

The Infection Protection Act, part of the legislative package, provides for compensation for loss of earnings due to the official closure of schools and daycare centres to curb the current pandemic. The aim is to mitigate the loss of earnings suffered by parents and guardians of children up to the age of 12 if they have to take care of their children due to the closure and are therefore unable to pursue their professional activities. The compensation of 67 percent of net income is granted for up to six weeks and is limited to a maximum monthly amount of 2,016 euros.

Changes to working hours

Nationwide exemptions from working time regulations are possible to ensure that, in particular, health care, services of general interest, but also public security and order are maintained during the pandemic.

Additional earnings for pensioners and short-time workers

The corona epidemic places a particularly high demand on medical personnel as well as in other system-relevant areas which can result in personnel shortages due to illnesses or quarantine orders.

In order to ensure that there is enough workforce, the social protection law therefore makes it easier for pensioners to continue working or to return to work. To this end, it temporarily raises the annual additional earning limit from €6,300 to €44,590 for this year without their retirement benefit or pension being reduced.

Incentives have also been provided for recipients of short-time work benefits (Kurzarbeitergeld) to volunteer during their non-working time, providing them additional earning opportunities. This also helps to cushion their income shortfalls.

Femi Awoniyi/ ©The African Courier

Visit the website of the Federal Government for more information about the Social Protection Package HERE