35. With what does the German state finance statutory social insurance?

Answer options

1. Church taxes
2. Social insurance contributions
3. Donations
4. Association membership fees

Explanation

The social state principle in Article 20(1) of the Basic Law obliges the state to secure core social risks. The statutory social insurance branches (health, pension, unemployment, long-term care, and accident) are financed predominantly through employer and employee contributions—social insurance contributions—on a pay-as-you-go basis and administered by self-governing bodies under the Social Code (SGB). The federal budget provides tax-financed subsidies, especially to pensions and health insurance, but church taxes, donations, and association dues play no legal role in financing social insurance. The system rests on solidarity and broadly parity-based cost sharing.