Family, social security and social insurance: General remarks and the present discussion in Germany as a case study



11

Overview 2: Public expenditure for families with children in Germany
- year 2000 -

thousand million Euro_________

tax expenditure

transfers in cash from public budgets (federal,

37.3

state and local level)
among this

contribution payments to social pension

26.9

insurance for years of child care

11.5

transfers in kind from public budgets 1)

71.0

transfers in cash from social insurance 2)__________

_____________16.0_____________

total

1)    1999

about 150

2) including “contribution expenditure” (contribution-free insurance) in health

insurance of children only and transfers in

motherhood____________________________

kind in case of pregnancy and

Source: Deutsche Bundesbank (2002: 19).

According to this overview by the German Bundesbank (2002) about 16 thousand million
Euro (more than 10 % of all public expenditure for families) are financed by social insurance
schemes. But there is another important sum financed by federal budget but relevant for
social pension insurance, namely contributions paid by the federal public budget to social
pension insurance for years of child care that are credited in the individual account of social
pension insurance. This is a relevant topic when discussing the role of transfers for families
within social pension insurance (see below). Taking these two positions together, about 20 %
of all family-oriented public transfers are linked to social insurance in Germany.

In social insurance schemes there exist a variety of measures focused on families. Without
being comprehensive the following instruments shall be mentioned (see Overview 3):

Overview 3: Instruments used in social insurance in favour of families

health insurance

long-term care
insurance

unemployment
insurance

pension insurance

coverage of non-working spouse and children
without own contributions

higher benefits for
insured persons
with children

credits for years of
child care

benefits in case of
pregnancy and
motherhood

contribution to pension
insurance in case of
family care

fictitious increase
of earnings

higher widow(er)’s



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