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New income limits, a “month of the premature baby” and the promotion of part-time work: the Federal Cabinet has decided to reform the parental allowance. The objective: to promote collaboration between parents.
The federal cabinet has decided to reform parental allowance. The changes affect high-income fathers, mothers and fathers who work part-time while receiving parental allowance and fathers of premature children.
New income limits will be established for obtaining the parental allowance: according to federal government plans, mothers and fathers who together have an income of more than 300,000 euros will no longer receive the parental allowance in the future. So far, the limit is 500,000 euros.
Parental benefit is paid to mothers and fathers who do not work or work shortly after the birth of the child. The state supports this with at least 300 euros and a maximum of 1800 euros per month, depending on the net earnings before the child is born. Parental benefit is paid for a maximum of 14 months if both parents are involved in the care. The payment period can also be extended further, with the so-called ElterngeldPlus. With this model, the monthly payments are correspondingly smaller.
“More association”
Mothers or fathers who receive parental allowance but already work part-time should be able to work 32 hours a week in the future instead of the previous 30 hours without losing their parental allowance. For example, a four-day week is possible. Also, there should be improvements in the so-called partnership bonus if both parents work part-time.
The reform aims to allow a greater partnership between mothers and fathers, as announced on Instagram by the federal Minister for Family, Franziska Giffey (SPD).
New “month of the premature baby”
A new “premature baby month” will be introduced: if a child is born six weeks before or earlier than the expected due date, the parents will receive an additional month of parental allowance in the future. This is intended to give those affected the opportunity to “better absorb potential delays in their child’s development,” as stated in the original bill, which was made public in February.
The new rules on parental allowance should come into force in 2021. The Bundestag and Bundesrat have yet to approve.
At its meeting, the cabinet also initiated an extension of the short-term allowance in the Corona crisis. In the future, they will be paid up to 24 months instead of the previous twelve months.
