Federal Training Assistance Act
In an order published today, the First Senate of the Federal Constitutional Court held that § 13(1) no. 2 of the Federal Training Assistance Act (Bundesausbildungsförderungsgesetz – BAföG) in the version in force from October 2014 until February 2015, insofar as it applied to students at public universities, was compatible with the Basic Law (Grundgesetz – GG). The provision at issue fixed the monthly financial need – referred to as the rate of general assistance (Grundpauschale) – at EUR 373 per month for university students. The Federal Constitutional Court holds that receiving state benefits for higher education is not a subjective constitutional right which the legislator could violate by determining a certain rate of general assistance afforded to individuals who are qualified for but lack the financial means to pursue higher education. While the social state principle mandates the state to promote equal opportunities in education and training, this mandate does currently not oblige the state to take action specifically with regard to higher education.
Federal training assistance, informally known as ‘BAföG’, is provided to students who are unable to afford their study and living costs. The total amount of BAföG that these students receive is comprised of the rate of general assistance, a housing allowance, a supplement for health and long-term care insurance as well as additional benefits for students with children. From October 2014 until February 2015, the plaintiff in the initial proceedings received BAföG for her university studies. She filed a lawsuit to claim a higher amount of federal training assistance, contending that the statutory rate of general assistance was unconstitutionally low. The Federal Administrative Court (Bundesverwaltungsgericht) suspended the proceedings and referred the provision under § 13(1) no. 2 of the Federal Training Assistance Act in the version in force at the relevant time to the Federal Constitutional Court for constitutional review. According to the Federal Administrative Court, individuals who have the qualifications but not the financial means to pursue higher education have a fundamental right to receive state benefits enabling them to equally participate in public university education. The Federal Administrative Court is of the view that the provision at issue violates this right because the rate of general assistance does not guarantee that students are able to cover their living costs during their time at university.
Facts of the case:
Under the Federal Training Assistance Act, university students are entitled to individual training assistance if they cannot otherwise afford their study and living costs. The specific level of financial assistance that these students require is calculated based on the rate of general assistance that is provided to cover study and living costs under § 13(1) of the Federal Training Assistance Act (i.e. the subject of the present proceedings), a housing allowance, a supplement for health and long-term care insurance as well as additional benefits for students with children. The sum of these components is offset against the student’s income and assets, as well as their parental and spousal income. If these amounts are below certain thresholds, they do not reduce the level of financial assistance granted. Half of the monthly BAföG rate is paid as a grant, the other half as a loan. Students whose training, in principle, entitles them to assistance under the Federal Training Assistance Act, are generally not entitled to receive basic welfare benefits pursuant to the Second Book of the Code of Social Law (Zweites Buch Sozialgesetzbuch – SGB II).
In October 2014, the plaintiff in the initial proceedings commenced her Master’s degree studies at a public university. In view of her parents’ income, she was granted a monthly BAföG rate of EUR 176 from October to December 2014 and EUR 249 in January and February of 2015. In the initial proceedings, the plaintiff seeks to be granted a higher BAföG rate for the time period from October 2014 until February 2015. She considers the rate of general assistance to be unconstitutionally low. The Federal Administrative Court has suspended the proceedings and has asked the Federal Constitutional Court whether the rate of general assistance under § 13(1) no. 2 of the Federal Training Assistance Act in force during the period in question was compatible with the Basic Law.
Key considerations of the Senate:
Based on all relevant constitutional standards, the rate of general assistance during the period in question was compatible with the Basic Law.
I. Receiving state benefits for higher education is not a subjective constitutional right which the legislator could violate by determining a certain rate of general assistance afforded to individuals who are qualified for but lack the financial means to pursue higher education.
1. Art.1(1) of the Basic Law in conjunction with the principle of the social state under Art. 20(1) of the Basic Law sets out the right to the guarantee of an existential minimum in accordance with human dignity. This right does not grant individuals who have the qualifications but not the financial means to pursue higher education an entitlement to state benefits to enable them to study at university. Only individuals who are unable to maintain a life in accordance with human dignity on their own may rely on this constitutional guarantee. This is not the case for individuals who are able to directly avoid or end such a situation of need, for instance by taking up an employment that allows them to cover their essential living expenses. Only if self-help is not available do individuals have a right to receive state benefits to cover their basic living costs. This applies even if it means that certain fundamental freedoms, such as the right to pursue higher education under Art. 12(1) of the Basic Law, may not be exercised due to a lack of financial means. An individual’s human dignity is not infringed if instead of pursuing higher education they need to take up a vocational training or employment, in order to allow them to provide for their essential living costs.
2. While individuals who are qualified for higher education have a right to equal participation in public university education pursuant to Art. 12(1) first sentence of the Basic Law in conjunction with Art. 3(1) of the Basic Law, this right does not encompass an entitlement to being provided with the necessary material prerequisites. The right to equal participation in public higher education is a derivative right. It refers to the state’s higher education offer and thus only comes into play when equal participation in public university education is hindered by state measures which, for instance, deal with capacity limitations by putting in place selection processes which are not merit-based, or designing the higher education offer in a manner that does not sufficiently satisfy social justice requirements. In contrast, the right to equal participation in public university education does not include an entitlement to be provided state benefits in order to eliminate obstacles to higher education access that exist due to social circumstances.
3. The principle of the social state enshrined in Art. 20(1) of the Basic Law does not afford individuals who have the qualifications but not the financial means to pursue higher education a subjective right to receive state benefits that enable them to study at university. Pursuant to the principles of democracy and the separation of powers (Art. 20(2) and (3) of the Basic Law), the legislator is granted broad organisational leeway when implementing a fair and just social order to fulfil the requirements of the social state. This leeway generally excludes a constitutional entitlement to receive state benefits in order to make use of fundamental freedoms.
a) The state’s mandate under the social state principle encompasses a plethora of tasks that are diverse and extensive in nature. They include caring for and protecting individuals who are in need or disadvantaged in society, caring for and supporting children and young people, providing social security against the vicissitudes of life and promoting employment, education and training. In doing so, the state must endeavour to reduce social barriers to the exercise of fundamental freedoms. Under the social state principle, the state has a general duty to translate the order of fundamental values under the Basic Law into constitutional practice. This general duty entails an objective legal mandate to promote equal opportunities in education and training at all stages of life that are decisive in this respect. This mandate incumbent on the state reflects the extraordinary importance that must be accorded to the social permeability of the education and training system, which is paramount for a fair and just distribution of life opportunities based not on social backgrounds but on individual abilities.
b) The funds available to the state for fulfilling these tasks are necessarily limited. Using these funds affects the public budget. Given the limitations on borrowing set out in Arts. 109(3) and 115(2) of the Basic Law and the necessity to preserve the taxpayers’ willingness and ability to pay, the state cannot indefinitely increase its revenues. This also applies to the funds necessary for fulfilling the state’s mandate imposed by the principle of the social state, given that under the Basic Law, this mandate does not have precedence over the fulfilment of other state tasks. In practice, limitations to increasing social benefit payments also follow from the necessity to preserve the taxpayers’ willingness to act in solidarity with socially disadvantaged individuals. This solidarity is indispensable for realising a fair and just social order.
c) The fact that the available funds are limited requires prioritising the fulfilment of certain state tasks over others based on their type, timing and extent. This also applies in terms of the tasks imposed by the social state principle, given their extensive financial implications. Determining by way of public debate which aspects are to be prioritised – a necessary step to solve the distribution conflicts – and adapting this prioritisation to the evolving needs of society is a core element of the political latitude afforded to the parliament elected by the people. In terms of functional organisation, parliament is also best positioned to achieve appropriate results in cooperation with the government. If a subjective constitutional right to state benefits were afforded in order to remove social inequalities which stand in the way of equal opportunities in realising fundamental freedoms, this would interfere with the democratically legitimated legislator’s competence to decide on how to use the limited financial funds at its disposal. If there were such a constitutional subjective right to state benefits, this would have a comprehensive binding effect on the state under Art. 1(3) of the Basic Law. In the long run, the funds necessary to fulfil this right could thus no longer be used to fulfil other objectives in the interest of the common good in accordance with an overarching prioritisation of the state’s tasks based on current conditions in society and the economy. Consequently, it is only in exceptional cases that a constitutional entitlement to state benefits may be derived from the interdependent effect of the state’s mandate under the social state principle and the order of fundamental values under the Basic Law. Such exceptions may only apply for special constellations and if granting a constitutional entitlement to state benefits is absolutely indispensable for the realisation of fundamental freedoms.
d) There is no such exceptional case when it comes to enabling individuals to study at university if they have the necessary qualifications albeit not the financial means to do so. However, state benefits that allow these individuals to partake in public university education are of paramount importance for ensuring equal access to training and employment opportunities. Otherwise, these individuals would regularly be barred not only from their preferred path of training but also from entering the occupation of their choice. Distributing life opportunities in such a way that they depend on individuals’ financial circumstances conflicts with the decisions on values enshrined in the Basic Law regarding the freedom of training and education, equality and the principle of the social state.
It does not follow, however, that – compared to the importance and urgency of the state’s other tasks under the social state principle – enabling individuals who have the qualifications but not the necessary financial means to pursue higher education is of such weight as to be permanently indispensable, regardless of society’s evolving needs. This is not altered by the fact that removing social barriers to higher education access is a part of the state’s specific mandate to promote equal opportunities in education and training. A special indispensability of enabling higher education access is also not discernible when comparing this task to other social needs which also fall under the state’s mandate to promote equal opportunities in education and training. In terms of access to non-academic training and employment too, an equitable distribution of life opportunities can only be guaranteed if access does not depend on individual finances but solely on individual abilities. Moreover, life opportunities can be curtailed at an early stage in a myriad of ways, for example if there is a lack of early childhood education or support for children and young people from socially disadvantaged families. For all these social needs, which compete with each other due to the limited amount of available state funds, the legislator must retain its authorisation to prioritise based on socio-political considerations.
II. The rate of general assistance under § 13(1) no. 2 of the Federal Training Assistance Act in the version in force at the relevant time is also not objectionable when assessed against the state’s objective legal mandate to safeguard equal opportunities in training and education, which follows from Art. 12(1) of the Basic Law and the principle of the social state.
While the legislator generally has considerable leeway in shaping the social state, this leeway would be exceeded here if entire population groups were factually excluded from accessing certain types of training and occupation from the outset due to measures that evidently fall short of promoting both social permeability and an equitable distribution of life opportunities in education and training. If this were the case, the state would be obligated to take actions to rectify this situation. To do so, it would be afforded a leeway for assessment, evaluation and action.
Accordingly, the state is currently not under an obligation to take action with regard to higher education. Given that the state does not completely neglect promoting the social permeability and equitable distribution of higher education opportunities, it is not the case that a substantial part of the population has no access to higher education from the outset. Indeed, the state in particular promotes the social permeability of public university education. It does so not only by providing BAföG to individuals who are qualified to pursue higher education but cannot afford to do so – one sixth to one fifth of all students receive BAföG and, for most of them, this is what enables them to study at university in the first place. The state also promotes social permeability by extensively using public funds to offer higher education in a manner that is compatible with social justice requirements.