German Senate blocks landmark social reforms By Reuters

BERLIN (Reuters) – Germany’s conservative opposition on Monday halted a major welfare reform, paving the way for a mediation process to introduce ambitious measures to support the unemployed in obtaining vocational training.

The goal of the reform is to increase the income of social benefits recipients and to address the shortage of skilled labor in Europe’s largest economy.

Welfare reform will introduce Buergergeld, or “citizens’ money,” to replace the Hartz IV system in place since 2005 and penalize people who decline job offers.

Conservatives in the Bundesrat have blocked the reform, arguing that it promises to be so generous that lower-income workers will get less money than those who benefit from the changes, a charge the government rejects.

“The welfare state can only function if there are duties as well as rights,” said Baden-Württemberg’s Labor Minister Nicole Hofmeister Kraut of the opposition conservative CDU party.

Florian Hermann, Bavarian Labor Minister for the Bavarian Christian Social Union (CSU), echoed his comments, saying the reform threatens to send a signal that work is becoming less important.

This measure was approved by the House of Representatives last week. German Labor Minister Hubertus Hill said the ruling coalition – his Social Democratic Party, the Green Party and the Free Democratic Party – would convene a mediation committee later on Monday.

Buergergeld’s reform, which the government is seeking to implement from January, will remove penalties for those who decline job offers, increase benefits across the board and give extra money to recipients during apprenticeship training.

(Reporting by Holger Hansen; Writing by Paul Carrell; Editing in Spanish by Ricardo Figueroa)