German Labor Minister Ursula von der Leyen convinced her regional counterparts and municipal representatives on Friday that a planned increase in child benefits should come in the shape of better leisure and education services, rather than higher cash payments.

But the government's idea of handing out vouchers or chipcards for leisure activities such football or music lessons, remains controversial.

Reform plans

The plans are part of a legally required reform of the benefits system for the long-term unemployed and those who receive benefits because they cannot work, also known as Hartz IV.

"Families that have to survive on Hartz IV live in poverty," Ulrich Schneider, President of the Association of Parity and Welfare, told Deutsche Welle.

"Their children cannot take part in all sorts of everyday activities, like going to a sports club or taking music lessons, because there simply isn't any money. Tuition is an impossibility, so these kids often lack education too," he explains.

Infrastructure concerns

Since 2002, there has been a 25 percent reduction in the number of people working on youth projects and in youth facilities, according to Schneider. He says the only way to address the issue is "to introduce a legal right to youth development programs for all children, just like we have a legal right to a place in a nursery or creche."

While over 20 associations in Germany support Schneider's concept and most agree that children need access to leisure activities and education, some say a voucher system is not the answer.

Christian Democrat von der Leyen faces opposition from the conservative, mostly Bavarian, arm of her party, the Christian Social Union. Bavaria's Social Affairs Minister Christine Haderthauer on Friday reiterated her objection to the vouchers, but said she would welcome benefits such as free school meals and free tuition as part of the reform package, which the government is due to present in September.

Other critics argue that the voucher system interferes with parents' independence and creates a nanny state.

"These systems stigmatize and discriminate, that's why we object to the idea of the vouchers or chip cards," Adolf Bauer, President of Germany's Social Welfare Association (Sozialverband) told Deutsche Welle.

But von der Leyen argues that such schemes have worked well in the south-western city of Stuttgart as well as in Sweden, where kids even consider it 'cool' to use the vouchers or cards.

New concepts

Families with children on so-called Hartz IV benefits currently receive a cash payment of up to 387 euros ($498), but according to a recent court ruling, the way these payments are calculated needs to be reworked. The government has until January 2011 to implement a new concept.

Three families filed a lawsuit against the Hartz IV guidelines in 2005, arguing that the benefits for children were arbitrary and did not even cover minimum subsistence levels.

The case was first dealt with in two lower courts, which questioned the legality of the existing standard benefits, and asked the country's Constitutional Court for clarification.

Author: Nicole Goebel
Editor: Susan Houlton