Early childhood and school financing



Local governments (Kommune) fund public daycare centers for children, while the Land (subsidies for labor and material expenses) and parents fund private daycare centers. Private day-care facilities (churches, parents’ initiatives, etc.) are supported by the local government (Kommune), the Land, parental payments, and their resources. Länder may provide funding for investment, personnel, and material expenditures.

In 2019, the public sector spent 33.6 billion euros on early childhood education and care. The Länder contributed 16.1 billion euros (47.8% of primary sector spending), while local authorities contributed 17.2 billion euros (51.3%).

This was 9.8% higher than last year and 113.6% more than 2010. The rise in spending is connected to the growth of childcare facilities for preschoolers. It was decided in 2007 that until 2013, excellent day-care services for children under three years old will be established in day-care facilities and child-minding services. For example, the KiföG from 2008 governs financial help granted by the Federation to develop child care by establishing a “child care expansion ” special fund. The right to early childhood education in a daycare or childminding service has been legal since August 1, 2013. 

The Federation has provided Euro 3.28 billion for children under three since 2008. It has established over 560,000 daycare slots for children under three in the last decade. The fourth investment program (2017-2020) would provide 100,000 new school seats for children aged 0 to 14. In addition, the economic stimulus package included a fifth investment program at €1 billion for 2020 and 2021. The funds will allow for 90,000 new child care facilities and child care centers. The funding may also be utilized for conversion and new hygiene and room designs required by the Corona epidemic. The investment programs require governments and localities to shoulder some of the expenses.

The Federation will help the Länder until 2022 with roughly 5.5 billion Euros for improving childcare quality and relieving parents of costs via the Quality and Participation in Child Day Care Act (Gesetz zur Weiterentwicklung der Qualität und zur Teilhabe in der Kindertagesbetreuung).

Possible New Changes To Student Loan Bankruptcy Rules By The Biden Administration

In an House Committee on Education and Labor hearing earlier this week, Federal Student Aid chief operating officer Richard Cordray told members of Congress that the current Department of Education approach to federal student bankruptcy cases is untenable.”The process isn’t working properly,” he said. “It needs to be reformed … and we’re committed to doing that.”

Cordray stated his belief that The Biden administration is currently looking at methods to alter the way the Department of Education treats undue hardship situations for students who are borrowers of federal loans who seek bankruptcy discharge according to Bankruptcy HQ. Although he did not provide any details, some advocates have proposed a range of indicators which the Department could employ to help (rather instead of oppose) an alleged hardship claim, for example the same level of poverty for a period of several years or reliance on income earned from public benefits like Social Security. Should you believe that the Department of Education stops opposing at least a few borrowers who are trying to obtain undue hardship bankruptcy discharges, this could be a major change in the way it operates, and allow for the relief of many more people seeking relief.

PK-12 education

School funding

The public education system is funded by the Länder and Kommunen (local authorities). The Länder Ministries of Education and Cultural Affairs are responsible for paying non-teaching personnel and material expenditures. Public school attendance is free.

Local authorities get reimbursements or lump-sum grants from the Land budget to help balance school costs between local authorities and Länder (generally by the Ministry of Education and Cultural Affairs or by the Ministry of Finance). The Land also helps local governments with one-off grants, such as school building or operating expenditures.

Sonderpädagogische Bildungseinrichtungen (special schools) und Fachschulen, the Land might be the Schulträger, therefore responsible for supporting the material expenses non-teaching staff salary.

In 2019, the public sector spent Euro 73.8 billion on public and vocational schools. The Länder portion was Euro 59.8 billion (81.0%), while the local authority share was Euro 14.0 billion (19.0%).

After the Bundestag, the Bundesrat amended Article 104c of the Basic Law in March 2019. An administrative agreement was reached in parallel with the legislative process. With the constitutional change, the Federation may help the Länder improve the effectiveness of local education infrastructure, which is essential for the state as a whole.

The revision of Article 104c of the Basic Law was required for the DigitalPact School 2019-2024 to create future-proof digital education infrastructures. The Federation will spend 5 billion Euros, and the Länder will contribute 500 million Euros to school digital infrastructure. The L ⁇ under will also assure teacher development and curriculum development.

Due to the Corona epidemic, the Federation and the Länder have agreed to amend the current financing rules. The Länder will also get an “urgent equipment program” for school terminals, an agreement to boost IT management, and a teacher equipment lending program. The Federation provides Euro 500 million for each program, with the Länder paying 10%. The Länder are also increasing efforts to educate teachers in digital teaching and learning (e.g., technology, didactics, media skills).

Vocational training funding

The dual system of vocational training functions in two places: firms and Berufsschule (vocational school). Companies fund most non-school vocational training, with 2012/2013 net expenses estimated at Euro 7.7 billion (latest survey). Budgeting for dual-system education and training is tricky. Adding items that may be attributed to the transition system (Übergangsbereich) because they promote the transition to vocational education and training brings the total to roughly Euro 2.6 billion for 2014. This includes external and inter-company training. In 2016, the Länder spent around Euro 11.7 billion on vocational schools.

Financial Independence


The legislative requirements allow maintenance bodies for children’s daycare centers to manage their funds.

PK-12 education

The area of public administration is currently being modernized and developed to make better use of resources. This procedure aims to free schools from excessive resource regulation by increasing school financial autonomy. Recent changes to school law have made it possible for schools to manage their budgets. In most Länder, schools already have control over how they use their budgeted resources (e.g., learning and teaching aids). Initial plans for autonomous utilization of staff resources are already in place.

Public School Fees


Early childhood education is not part of the public school system, and daycare is not always accessible. Parental payments are imposed to help cover part of the expenditures. The amount varies depending on the parents’ financial situation, the number of children, and the daily attendance time. From August 1, 2019, the Child Day Care Quality and Participation Act requires all states to stagger payments.

In recent years, new laws have been passed to help parents. For example, in various Länder, daycare is totally or partly free depending on the child’s age and the care provided. There are no contributions for the last year or years of child care in certain countries.

PK-12 education

Public primary and secondary school attendance is free, as are enrolling and report card payments.

Help for Students’ Families


If parents cannot afford financial contributions, they may be excused in whole or in part. The local youth welfare office would then take over. As of 1 August 2019, the Act on the Further Development of the Quality and Participation in Child Day Care exempts transfer-paying households and low-income families from receiving child supplements or housing assistance from childcare contributions. The Länder may also use these monies to help households pay their costs.

PK-12 education

In line with the Asylbewerberleistungsgesetz as well as the Bundeskindergeldgesetz (Act on National Child Benefits) (families that purchase a chi) and the Asylbewerberleistungsgesetz (Asylum seekers are protected under German social welfare legislation.) (so-called education package).

The legislation considers the following needs for qualifying students:

  • Expenses for school lunches, as well as daycare and childminding services,
  • adequate learning help that enhances education, taking into mind the relevant school law rules in each scenario;
  • 150 Euros in two installments for 2020 school requirements such as a knapsack, writing, calculating, and drawing equipment;
  • expenditures for daycare facilities for children, child daycare, and school excursions lasting one or more days;
  • Unless otherwise covered or presumed.

From August 1, 2019, children and young people entitled to benefits will be able to engage in social and cultural activities worth at least Euro 15. (e.g., for membership fees in sports clubs or music school fees). A fraction of the participation money may be preserved. Local governments and districts are responsible for implementing the education package. According to a July 2020 judgment by the Federal Constitutional Court (Bundesverfassungsgericht), a partial rearrangement of these support services is required to finance education and participation services by January 1, 2022.

Financial assistance for students with disabilities

No information on financial aid for students with disabilities is available. Families with children with impairments may get help under the Social Code’s Book Eight (Achtes Buch Sozialgesetzbuch – SGB VIII) or its Book Nine (Neuntes Buch Sozialgesetzbuch – SGB IX).

Student Aid

Pupil financial aid

In general, secondary school students in grades 5–9 are not eligible for financial aid. Some Länder has legislation giving financial help to students up to 9th grade who must live away from home.

By law, students at general and vocational secondary schools who require financial assistance (mostly from their parents’ income) may get financial aid from the state in a grant. Some schools require students to live away from home if the school is not accessible from there. The student’s income and financial means and the payment of their parents and, if appropriate, spouse are considered when determining the amount of training support. The Federal Training Aid Act allows students to obtain financial assistance ranging from Euro 243 to 580 per month, depending on whether they live with their parents or not. One-off medical and long-term insurance coverage subsidies of up to 109 Euros. The state’s help is not reimbursed.

In 2018, the Federal Training Assistance Act helped over 210,000 students. The Federation spent approximately 700 million on student financial aid under the Federal Training Assistance Act. Supported students got an average of €454 per month.

In addition to government training support, students may be eligible for essential social security benefits for job searchers under Book Two of the Social Code. Some Länder allows upper secondary students who do not qualify for aid under the Federal Training Support Act to obtain financial assistance from the Land.

During their last years of school, students may utilize the federal government’s Educational Credit Program (Bildungskreditprogramm).

Lesson aids

Most Länder has legislation on providing financial support for students to acquire teaching aids (Lernmittelhilfe) or providing them free of charge (Lernmittelfreiheit) based on parents’ income and the number of children. These rules either exclude or partially exempt students from paying for instructional aids. The money comes from either the Schulträger or the Land. Public school students are loaned textbooks and other pricey instructional tools. For example, if the loan is for digital gadgets, the parents may be obliged to pay a share of the expenses. Parents and students provide material for crafts, embroidery, and metalwork instruction. In certain countries, BYOD is mandatory. Students bring their phones to class. Each Land determines whether or not to provide accessible instructional aids to students in privately run schools.

School transport

Each Länder has plans for student transportation. There are distinctions in who may utilize school transport and the services supplied. In all circumstances, substantial arrangements for compulsory full-time education are made. Generally, fares are refunded for public transportation, and in other cases, a separate school bus service is formed. The goal is to provide equal opportunity for students from all backgrounds, urban and rural, with and without disabilities.

Districts and municipalities are typically responsible for providing enough transportation to and from school. Rural or urban districts or maintenance authorities frequently subsidize school transport (i.e., the local authority). In most situations, the land itself provides subsidies.

School bus services must be affordable for the financial authority and provide appropriate standards for the students who utilize them. Only students who reside a specified distance from their school are entitled to bus transportation. There are minor variations across the Länder. From grade 5 onwards, students living up to three or four kilometers away from school are expected to make their way there and back. Exceptions may be granted for shorter distances and students with disabilities. Most people prefer public transportation. 

The local government offers school transportation if none exists. When this option is neither feasible nor reasonable for disabled students, a subsidized private automobile or handicapped taxi service is typically the best option. Due to a physical, mental, or sensory handicap, a child may be accompanied to school by a person whose fare is paid by the local authorities. The mode of transit between home and school varies depending on the locality and the circumstance. Some Länder has explicit rules, while others leave it up to districts and municipalities to adopt basic recommendations.

The authorities are not required to transport students to any school, no matter how far. However, each Land defines the word “nearest school” differently. Parents who send their children to a school other than their local school may be eligible for partial reimbursement of travel expenses.

The assumption of travel expenses by the government does not imply that all Lenders provide free school transport. However, in this scenario, the contribution is based on parental income.

Pupil accident insurance

In the Federal Republic of Germany, all students and pupils are insured during classes, on the route to and from school, and at school festivities. This includes programs such as school dinners, research visits, and travel. This group administers local authority accident insurance.

Pvt and Grant-aided Schools


The Land and the municipalities (Kommunen) fund private child and youth welfare organizations that manage daycare centers for youngsters (e.g., for operating costs and investments).

PK-12 ed, education

The Länder provides several sorts of financial assistance to private school-keeping bodies. The cost condition in public schools is used as a benchmark. All Länder provides essential financial support to eligible schools, including payments to staff and material expenses. If a school has financial needs that the Länder does not meet, it may need to put up a budget and obtain a proportionate part of the subsidy. For example, sabbatical leave for permanent teachers with civil servant status might be paid while paying school fees and other forms of financial assistance. School expenses and transportation may be refunded to parents. 

The Länder primarily gives the funds, but some to the municipalities. Many Ersatzschulen (alternative schools) are run by Catholic or Protestant churches, which support them with their funds. Therefore, fees are seldom or never imposed. The proportion of public funding in privately owned schools varies by Länder and school type (There are also various exceptions, such as authorized private schools vs. acknowledged private schools, boarding schools, and church-run alternative schools.)


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