Solid budget with a focus on vocational qualifications and digitalisation

The administrative board today approved the budget for 2024, focusing on securing skilled workers by investing more in vocational training, investing in digitalisation and automation and building up some financial reserves. This has become possible again for the first time since the pandemic came to an end.

10 Nov 2023 | Press release no.49

The budget is based on the autumn statement of the German federal government

The budget is prepared on the basis of the autumn statement of the federal government. This assumes a slight increase in unemployment to an annual average of 2.64 million in 2024.

Income and expenditure

In its planning for its 2024 budget, the BA is set to have a total income of 44.6 billion euros and expenditure of 42.8 billion euros. By way of comparison: the BA will close 2023 with income of approximately 42.2 billion euros and expenditure of approximately 39.5 billion euros.

Build-up of reserves possible from 2023

The BA can start to gradually build up some financial reserves again starting from this year. At the end of the 2023 financial year, the BA plans to repay its remaining loan of 423 million euros and start building up reserves of 2.7 billion euros.

In the coming year, a further EUR 2.1 billion is expected to be added to the reserves to strengthen the resilience of the unemployment insurance system during periods in which the economy doesn’t perform so well. This could increase the reserves to approximately 4.8 billion euros by the end of 2024, although that still isn’t sufficient. According to calculations by the Institute for Employment Research (IAB) of the BA, the reserves should amount to at least 25 billion euros to compensate for future periods of economic recession.

One billion more euros for securing skilled workers

Approximately 10.4 billion euros is to be made available for the promotion of employment (excluding the short-time work allowance) in 2024. This is an increase of one billion euros compared with the amount spent in 2023. The focus is on securing skilled workers, with 2.5 billion euros set aside for vocational training. Another 2.9 billion euros have been set aside for helping the participation of people with disabilities.

This figure includes approximately half a billion euros for new statutory benefits, which also go into unemployment insurance through the reform of the Citizen’s Benefit and the Continuing Education Act. The new funding plans of the BA include the Vocational Training and Qualification Allowance and the Vocational Training Guarantee.

More than 800 million euros for digitalisation and automation

Some 817 million euros are planned for the IT infrastructure and the further digitalisation of the services of the BA, approximately 3.3 percent more than this year. The BA will continue to expand its wide range of online services and also provide customers with easy access to these services. Customers can already use 67 services online. The BA is therefore reaffirming its goal of becoming one of the most modern public service providers in Europe within the next ten years.

Higher spending on Unemployment Benefit

The BA budget sets aside 19.8 billion euros for Unemployment Benefit, approximately one billion euros more than will be spent in the current year. The increase is mostly down to higher benefit entitlements as a result of increased wages and salaries.

 

Chair of the Administrative Board, Anja Piel:

“Being made unemployed or having to work fewer hours with short-time work is a difficult and painful experience. Everyone who pays into the unemployment insurance system must be able to rely on full support during difficult situations like these. The members of our team at the employment agencies have proven that they can achieve great things during the current crises, day after day. Now, at a time of rising unemployment, they are needed more than ever as reliable contact persons who are available on site. This budget is intended to create the basis for the work that we do and the services we provide. If the situation worsens, we will have to add to our budget if necessary.”
 

Deputy Chair of the Administrative Board, Christina Ramb:

“In uncertain times like these, it is particularly important for the Federal Employment Agency to be resilient and well positioned. The constant crises and new responsibilities have increased the workload of the BA considerably. For this reason, it isn’t possible for us to build up sufficient financial reserves right now. Our goals for a resilient Federal Employment Agency are: financial stability, smart personnel planning and sufficient resources for being able to provide people with support and find them vocational training and work. This budget means that the Federal Employment Agency can continue to achieve these goals.”

Chair of the Executive Board, Andrea Nahles:

“Despite the current economic downturn, the budget of the BA for 2024 is solid, balanced and forward-looking. The higher investments for our offerings in the areas of qualification and integration as well as the additional funding for the further expansion of our online offerings will create the scope to provide our customers with the best possible support.”