Unsuccessful constitutional complaint against taking into account a family member’s income in determining basic income support

Press Release No. 60/2016 of 07 September 2016

Order of 27 July 2016
1 BvR 371/11

If family members who live in the same household can reasonably be expected to manage the household “out of pooled resources”, the income and assets of another family member may be taken into account in that “community of need” (Bedarfsgemeinschaft) in determining the applicant’s neediness as required when granting benefits intended to secure the recipient’s existential needs. This may be done irrespective of any maintenance claim against the family member. However, no one who is not actually supported financially is to count as belonging to the community of need. In his constitutional complaint, the complainant had argued that in calculating the amount of his benefits to secure his minimum needs, the invalidity pension collected by his father had in part been taken into account as reducing his needs even though he had no enforceable maintenance claim against his father.

Facts of the Case:

The complainant lived with his father, who collected an invalidity pension. In compliance with Book Two of the German Code of Social Law (Sozialgesetzbuch), the agency providing basic income support benefits granted the complainant a lower amount of benefits. The agency stated that the complainant lives in a community of need with his father, so that only 80% of the standard benefits are to be taken as a basis for calculating his entitlement, and his father’s pension must at least partially be taken into account as reducing it. The Social Court (Sozialgericht) rejected the action brought by the complainant and his father against that decision, and both the appeal on questions of fact and law and the one on questions of law alone were unsuccessful. In his constitutional complaint, the complainant primarily claims a violation of his right to a guarantee of a dignified minimum existence (Anspruch auf Gewährleistung eines menschenwürdigen Existenzminimums).

Key Considerations of the Senate:

The constitutional complaint is unfounded.

1. The right under the Constitution to a guarantee of a dignified minimum existence covers those means that are absolutely necessary for securing both the physical existence and ensuring a minimum of participation in social, cultural, and political life. The legislature has a margin of appreciation in making the relevant value decisions and determining the needs to be met for ensuring a dignified minimum existence, known as necessary needs (notwendiger Bedarf) that must be met. Consequently, as a rule, in assessing neediness, the income and assets of persons from whom mutual support can be expected due to a reciprocal sense of duty can be taken into account. Reducing the necessary needs this way is not precluded even where there is either no maintenance claim under private law, or where its amount would only be small. The deciding factor is not the possible existence of a maintenance claim, but the de facto economic conditions of the persons in need, i.e., that they are in fact managing the household “out of pooled resources”.

2. The challenged decision of the Federal Social Court (Bundessozialgericht) and the rules on basic income support benefits in a two-person community of need consisting of a grown child and a parent meet these requirements under constitutional law.

a) The total amount of benefits granted to secure the complainant’s subsistence does not fall below the amount that the Constitution requires to guarantee for a dignified minimum existence. It is true that the complainant was granted benefits only in a reduced amount. This follows, however, from the partial crediting of his father’s invalidity pension against the benefits, which ensues from the challenged provisions in which the legislature set down a general rule of assumption, which, if applied, results in assuming that the complainant’s needs are covered by corresponding contributions from his father. In this case, his father did indeed have adequate means to contribute towards securing his son’s subsistence.

b) The total amount of the benefits granted to ensure the complainant’s minimum needs of existence can be justified under constitutional law. The factors taken into account for its determination are plausible and differentiate according to the relevant facts. It is not objectionable under constitutional law to reduce social benefits, granted to guarantee a dignified existence where the neediness of the person concerned is a guiding factor in their determination, by a lump sum for savings that are typical of living together in a family household. In particular, it is sufficiently plausible that family members living together in one household would in any case manage the household completely “out of pooled resources”. The assumption that it leads to savings of 20% if another adult joins a community of need, which is relevant to determining standard needs, can be based on an adequate empirical basis, at least for a two-person community of need; thus, this assumption stays within the legislature’s margin of appreciation. The case does not call on the Senate to decide whether a minimum dignified existence is no longer guaranteed if standard benefits are reduced by 20% for each person added to the household, and if so, starting with how many such additional persons.

It is also not objectionable under constitutional law if, in a community of need comprising one parent and one adult child, benefits are distributed unequally between the two. It appears sufficiently plausible for the legislature to assume that parents in a household, even with a grown child, will regularly assume the main share of the cost and will forgo an exact accounting.

c) If parental income is credited against the regular amount of standard benefits, this does not eradicate the complainant’s statutory entitlement to be paid benefits to secure his existence, which is constitutionally guaranteed. Rather, it only limits the amount of the individual entitlement to receive benefits from the agency providing basic income support, based on the facts of the specific case. The legislature proceeds, with plausible reasons, from the assumption that securing the existence through basic income support benefits is necessary only to the extent that subsistence is not provided by members within a common family household.
Here, the legislature may be guided by the plausible assumption that a relationship within the nuclear family – i.e., between parents and children – is generally such a close bond that mutual support can be expected, and that the household will regularly be managed “out of pooled resources”. However, if parents refuse in earnest to financially support their children not entitled to maintenance, there is no common household within the meaning of the legal provisions, and thus no “community of need” may be assumed. In that case, income and assets are not to be taken into account; also, it must then be possible to move out of the parental home without adverse consequences for the entitlement to basic income support.

3. The differences under the benefits systems of the Second and the Twelfth Book of the Code of Social Law in the design of benefits to secure subsistence between both children below and children above the age of 25 living in a community of need with one or both parents, and between those children and children who are of age and live in the parental household, are compatible with the requirements of the general principle of equality under Art. 3 sec. 1 GG.

a) The legislature includes adult children up to the age of 25 in a community of need because it thereby pursues the legitimate aim of aligning entitlements to social benefits with the specific neediness of the entitled beneficiaries, and, at the same time, of sparing the “community of solidary” between the insured persons (Solidargemeinschaft). To use joint habitation and age as guiding factors is suitable for this purpose, because it is plausible to assume that parents living together with children beyond the age of 18 will manage the household “out of pooled resources”. The unequal treatment of children below and above the age of 25 in a parental household is also reasonable. If parents refuse in earnest to financially support their children, the latter are no longer part of the community of need even before they have reached the age of 25. Then, they are entitled to the full amount of standard benefits, and no crediting of their parents’ income against those benefits takes place. In such cases, they may also move out without losing their entitlement.

b) The differences between the benefits systems are also sufficient to provide plausible reasons for different rules for crediting. Book Twelve of the Code of Social Law covers persons in need who either temporarily or permanently have a reduction in earning capacity. Their options for supporting themselves are accordingly significantly restricted. By contrast, the Second Book of the Code of Social Law concerns persons in need who in general might be capable of securing their subsistence themselves. In such cases, the benefits for securing existence are granted temporarily, and are supplemented with benefits to assist with regaining employment.