For Solo Self-Employed Persons, freelancers and micro enterprises, the “unbureaucratic” Coronahilfen are rather a disappointment according to the situation of things. Although federal states such as Bavaria and Lower Saxony were the first to launch their own programmes, as they do not tire of emphasising, these only served to raise their political profile, as it now turns out. In practice, the measures, in which there were also massive technical start-up difficulties, turned out to be unusable. Those affected faced more or less insurmountable obstacles as well as the threat of not committing any subsidy fraud. Therefore, the urgent emergency aid of the Länder will also be replaced by a federal programme, which also raises questions. Nevertheless, the Trick of the princes of the state works, because there is hardly any criticism of their approach.
Countries such as Bavaria and Lower Saxony are pushing ahead with a lot of fuss. They have specially tailored and launched emergency aid for the self-employed, but they have also provided these with hardly fulfilling conditions in small print. For example, grants have been linked to still existing liquid funds, in short reserves. These should have been used up first. This is strange, since such reserves are usually formed for illness, holiday periods, further provision and for future business acquisitions. Of course, such reserves also serve to cushion fluctuations in the order situation, but with a nationwide Shutdown, which is ordered by the authorities, normal gainful employment is made virtually impossible. How can one justify that the self-employed should first consume their reserves, while other occupational groups continue to receive salary or a wage compensation benefit, which is of course not tied to the amount of reserves?
Political Show Programs
Anyone who has managed since last week to submit an application despite overloaded server capacities at small promotional banks such as NBank in Lower Saxony is now allowed to deal with the topic once again. Since 1 April, a federal aid programme has replaced the federal state initiative, which had been designed with comparatively high hurdles and too few benefits rather unfavourably for Solo Self-Employed Persons, freelancers and micro-enterprises. In the example of Lower Saxony, subsidies could only be applied for if an economic situation threatening to exist exists. This is vaguely worded, since the Shutdown has only been in effect since mid-March and many fees are still likely to be paid, with which those affected can pay their bills in April. According to the directive, it only becomes existence-threatening if the sudden decline in orders is also noticeable by a lack of money receipt. Of course, this is more the case with some of them, since events may no longer take place through general orders or facilities in which fee-paying staff are active must remain closed.
Therefore, from the point of view of those affected, the threat to their existence already exists with the Shutdown, since the losses are immediately foreseeable for them. However, according to the directive, you can only submit an application in Lower Saxony if there has been a decline in sales or fees of at least 50 percent compared to the average monthly sales in the previous year or if there is a short - term liquidity shortage, which is usually excluded initially if there are reserves. If the conditions were nevertheless met, there would have been 3,000 euros in emergency aid from state funds in Lower Saxony for up to five employees. In Bavaria it would even be 5000 euros. However, one would have had to consume still available liquid private assets before. This is absurd. One must therefore speak of political show programmes that are useless for those affected, but useful for those in power. They have gained profile through benevolent headlines and appropriate public attention. Both Bavaria and Lower Saxony boasted that they were the first countries to quickly become active for small businesses.
A responsible state minister like Bernd Althusmann in Lower Saxony apparently could not have guessed that the limited Server Capacities of a small Development Bank in Lower Saxony did not play a role. He apologized for the technical Blackout, but immediately switched back to a positive sales mode. The number of employees has been increased and forms have been made available for Download in addition to online applications. Now there are now tens of thousands of applications, of which already a considerable number (rather miserably) has been processed and positively granted. So the aid would arrive, the Minister is pleased, referring to unspecified positive reactions from the country. He then also praises that federal programme which in principle replaces his unfit measures.
The Ministry of Economic Affairs is therefore replacing the “liquidity protection for small businesses” directive, which entered into force on 24 March, with two new directives today. Lower Saxony was one of the first federal states to start its own Corona emergency aid programme. [ … ] A drawdown of personal or company reserves is no longer necessary for both directives. These are not counted towards a grant. Minister Of Economic Affairs Dr. Bernd Althusmann: “over the past two weeks, we have intensively negotiated with the federal government on the terms of the Liquidity Assistance. I am very satisfied with the result. The new guidelines are simpler, less bureaucratic and better endowed. The calculation of the liquidity bottleneck is less restrictive and the liquid funds from own or third - party funds are not used. In this way, we can guarantee all small companies in Lower Saxony Maximum support and support in these difficult times.”
However, the Minister presents it as if the Länder have achieved improvements in the funding conditions in the negotiations with the federal government. One only wonders why the national programs were so poorly designed. Unfortunately, there were no questions about this in the state press conference to the Minister. Affected persons, who have already applied for state funds, can therefore once again make an effort for federal funds. Both will then be charged against each other. Recourse to existing liquidity is no longer explicitly required. However, the federal program also aims only to replace the current operating expenses, which can no longer be financed from the revenues. So if you can still cover your operating expenses from shrunken revenues, even if these amount to 50 or more percent, you will probably run out of money.
Existential threat remains
Solo self-employed, there are more than self-employed with additional employees. They usually have low operating expenses. You already work from home or share a workplace in an office community. Few of them are likely to have rented their own offices, why even if you earn a living, for example, as a lecturer in an educational institution or as a freelance coach in a dance school. However, the operating costs to be covered by the aid programmes include rents and leases as well as loans for premises or lease payments. Living costs are explicitly not included in operating costs, as the funding conditions emphasize. This means that those affected must also contact the employment agency if they have voluntarily paid into the unemployment insurance and are entitled to unemployment benefit I or directly to the job centre in order to apply for basic security (unemployment benefit II).
Despite the simplified access, he still has it in him. The main proposal alone comprises six pages. For this purpose, attachments must be completed and submitted for the purpose of determining income and financial circumstances, for the purpose of determining the reasonable costs of accommodation and heating, for social security purposes, or for the purpose of making a provisional or final declaration on income from self - employment, business or agriculture and forestry during the authorisation period. Is this unbureaucratic? After all, it’s about livelihood. It is also forgotten that the basic security means a standard rate of 432 euros for single persons. The political leaders consider this appropriate and praise the functionality of the welfare state in their speeches. Associations like the parity see it quite differently. They do not consider the basic security to be livelihood-securing and therefore demand an increase in the standard rates, for example to ensure a balanced diet. One reason for this is that many panels had to close in the wake of the corona crisis. These institutions had organized a kind of replacement care for the needy under the Hartz IV Regime, which in itself is a scandal.
Solo self-employed persons are thus not saved from existence with the reference to the basic security, but driven into precisely this. Their reserves also do not remain protected, but must nevertheless be used for compensation due to the far too low social benefits. What actually distinguishes solo self-employed from managing directors of a GmbH? Both need money for their livelihood. The former makes private withdrawals from his company, which are not recognized as operating costs and also have no influence on the profit of the company, with the managing director of the GmbH this looks different. Its salary, as well as the wages of employees, are part of the operating costs, which have a profit-reducing effect on the balance sheet of the company. Or in short: the living costs of the managing director are assessed differently than those of the solo self-employed. The GmbH can continue to pay the salary of the managing director and send employees into short-time work through state subsidies. The solo self-employed can not do this. He has to accept the loss of income and apply for social assistance.
But that’s not all. In order to complete the tangle of applications, the federal government has also imposed the emergency child supplement for parents with lost earnings, which is only granted if certain minimum income limits are reached. Here, too, it is claimed – this time by an SPD-led ministry – that a service will be made more accessible. But it does not get any easier for those affected here either, as they have to ask themselves which applications they should now make and whether these do not also hinder each other. Telephone information is hardly possible under the current conditions. Thus, the finding remains that the multitude of individual rules hardly contribute to an uncomplicated bridging of the crisis, but rather trigger further uncertainties and injustices. Thus, in the end, contrary to all assurances from the ministries, many people are left alone.