How transfer payments for households with children have developed in comparison to inflation

The simulations based on a tax and transfer model show that the structural child-induced transfers in the analysis year 2023 - depending on the adult constellation under consideration (couple or single parent) and the number and age of children - have increased on average by around 15 to 25 per cent in nominal terms compared to the analysis year 2021. A large part of the 17% inflation since 2021 has therefore already been cushioned by structural changes in the transfer system, such as the introduction of the annual valorisation of many family benefits. Where this structural mitigation was not fully successful, which was also partly the case in lower income groups in particular, in most cases the temporary anti-inflation measures ensured that there were no real losses in child-induced transfers for 2023 compared to 2021. On average, structural and temporary measures together resulted in a nominal increase in transfer payments of around 21 to 30 per cent, thus ensuring significant real gains in some cases for both couple and single-parent households.

Comparison with 2021

The analysis of child-induced transfers is based on a model that simulates the interaction of taxes and transfer payments at federal, state and municipal level for 3,546 different household constellations. The term "child-induced" refers to transfer payments resulting from the presence of children in the household. The analysis focused on changes in child-induced transfers compared to 2021 due to structural measures, such as the abolition of cold progression or the introduction of the annual valorisation of many family benefits. In a separate additional evaluation, the temporary effects of temporary anti-inflationary measures on child-induced transfers were also analysed for the analysis year 2023. A final comparison of the changes in child-induced transfers and inflation allowed conclusions to be drawn as to how well the structural and temporary measures have been able to mitigate inflation so far and which income ranges or family constellations require special attention in order to avoid losses in the value of child-induced transfers.