Strengthen the economy, reform the welfare state: tackle bureaucracy reduction and social security contribution brakes now
On the occasion of the government retreat on state modernization, employers' association president Dr. Rainer Dulger states:
Strengthen the economy, reform the welfare state: tackle bureaucracy reduction and social security contribution brakes now
Berlin, September 30, 2025: "The government retreat comes at the right time. Reducing bureaucracy is long overdue. Our companies are struggling with crippling regulation, slow procedures, and digital backwardness. If we want to strengthen Germany as a business location, we must make the state more efficient, faster, and more practical.
But reducing bureaucracy alone is not enough. Reform of the welfare state is just as urgent. Social security contributions have been rising unchecked for years and are becoming a brake on growth. They jeopardize employment and place a massive burden on companies. A cap on social security contributions is long overdue. Work must become affordable again, otherwise Germany will finally lose touch with international competition.
The labor market also needs new impetus. The transition from transfer payments to employment must be made easier. Transfer withdrawal rates and tax disincentives must finally be put on the political agenda.
A fair welfare state must provide targeted assistance, be understandable, and remain sustainable for future generations. Concrete measures are now needed—in the modernization of the state and in the welfare state. Because only a strong economy can support social equality."
