Ifo Study: Demographic Change Drives Up Social Expenditures
An Ifo study reveals a significant rise in social expenditures since 1992, noting the system's stabilizing role during crises. A key concern is the increasing financial strain on the younger generation from contributions and taxes. Therefore, experts advise reforms to shift funding sources toward general tax revenues.
According to a current Ifo study, social expenditures are rising significantly; a clear increase in these expenditures has been noticeable since 1992. The social system has proven its function as a stabilizer during times of crisis in the past. However, the analysis shows that the importance of unemployment benefits for the social budget is decreasing. A central criticism emerging from the study is the growing burden on the younger generation due to social contributions and taxes. Given these developments, researchers recommend fundamental reforms aimed at generating revenue for social benefits more strongly from general tax revenues rather than relying primarily on contributions.