Public Hearing of the Committee on Labor and Social Affairs on the SGB III Modernization Act
October 29, 2024
The German Bundestag’s Committee on Labor and Social Affairs held a public hearing on October 29, 2024, to discuss the Third Social Code (SGB III) Modernization Act. The proposed legislation aims to reform the unemployment insurance system in Germany.
Background
The current unemployment insurance system in Germany is based on the SGB III, which was introduced in 1998. Over time, the system has come under increasing criticism for being too rigid and bureaucratic. The proposed SGB III Modernization Act aims to address these criticisms by making the system more flexible and efficient.
Key Provisions
The SGB III Modernization Act includes several key provisions, including:
- Introducing a new “job retention allowance” to prevent redundancies. This allowance would be paid to employers to encourage them to keep employees on their payroll during economic downturns.
- Expanding the use of part-time and short-time work to increase flexibility. This would allow employers to adjust their workforce more easily in response to changing economic conditions.
- Strengthening the role of the Federal Employment Agency in providing training and support to the unemployed. This would help to improve the employability of the long-term unemployed.
- Reducing the bureaucracy associated with unemployment benefits. This would make it easier for the unemployed to access benefits.
Testimony
The public hearing heard testimony from a wide range of stakeholders, including:
- Representatives from the government, including the Federal Ministry of Labor and Social Affairs
- Representatives from employers’ organizations, including the Confederation of German Employers’ Associations (BDA)
- Representatives from trade unions, including the German Trade Union Confederation (DGB)
- Representatives from non-profit organizations, including the German Paritätischer Wohlfahrtsverband
- Individuals who have experience with the unemployment insurance system
Feedback
The stakeholders gave mixed feedback on the proposed SGB III Modernization Act. The government and employers’ organizations generally welcomed the proposed reforms, while the trade unions and non-profit organizations expressed some concerns.
Next Steps
The Committee on Labor and Social Affairs will now review the testimony from the public hearing and prepare a report for the Bundestag. The Bundestag is expected to vote on the SGB III Modernization Act in early 2025.
Öffentliche Anhörung des Ausschusses für Arbeit und Soziales zum SGB-III-Modernisierungsgesetz
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