Family dissolution and public policies in Germany: Social provisions and institutional changes since the 1980s

Germany has long been faced with low birth rates and a pronounced aging of society. Recently divorces and single parenthood have been on the rise. Family policies and regulations dealing with family break-up are thus confronted with new and greater challenges. After describing important changes in household and family composition in more detail, this paper outlines the regulation of the consequences of family break up in relation to alimony and child support. The main part of the paper focuses on public policies in support of families. Here monetary benefits as well as child care services are considered. Because of the increase of single-parent families a small-subsection specifically looks at special benefits for single parents. The analysis of child care and parental benefits, and their evolution in Germany, reveals considerable increases in benefits since the mid-1980s. The changes in child benefits and parental allowance can be broadly classified into three periods where benefits rise from low to high: 1) until 1985, benefits were very low; 2) in 1986, parental allowance was introduced, so that from 1986 to 1995 the level of benefits was moderate; 3) in 1996, the period of high benefits began and benefits were increased considerably. The 2007 reform of parental allowance led to an implicit indexation in which the benefit is now related to formerly earned income. This reform entailed clear increases for middle and high earners. However, low income earners and recipients of social transfers clearly lost when the benefit duration was reduced. Not only have cash benefits been increased, but child care services have also been extended in the western federal states. In terms of institutional reforms regarding alimony and child support, there has been little change compared to the development of family policy benefits.