Financing for equity in primary and secondary education
1. Education resources to subnational governments
2. Education resources to schools
3. Education resources to students and families
4. Social policies and family support programmes
Introduction
In Germany, education financing follows a decentralized model, with responsibilities divided among federal, state (Länder), and local (Kommunen) governments. The Länder hold primary authority over basic education, setting curricula, managing teacher recruitment and salaries, and maintaining school standards. Local authorities are responsible for operational aspects such as infrastructure, maintenance, and day-to-day school management. At the national level, the Federal Ministry of Education and Research (BMBF), together with the Standing Conference of the Ministers of Education and Cultural Affairs (KMK), ensures coordination and provides funding for specific nationwide programs and student financial aid.
Most of the public education funding—about 90%—comes from the Länder and local authorities. This funding supports teaching and non-teaching staff, school operations, capital expenditures, and programs for disadvantaged students. Financial flows typically involve intergovernmental transfers, with the Länder allocating funds to municipalities and districts, which in turn distribute resources to schools. For example, teacher salaries are generally covered by the Länder, while local governments handle infrastructure and facility maintenance, ensuring schools are adequately staffed and equipped.
For more information, see the flows of public funding for public primary and lower secondary educational institutions in Germany.
1. Education resources to subnational governments
Resource allocation to subnational governments—Länder and municipalities—relies on a mix of tax revenue sharing, earmarked grants, and direct transfers. A key component is the fiscal equalization system (Finanzausgleich), which redistributes national tax revenues, including VAT and income tax, to the Länder based on population size and fiscal capacity. Additional transfers to municipalities are adjusted to reflect local needs.
Equity is built into these funding mechanisms through per-capita formulas and needs-based indices that consider socioeconomic differences. However, the specific weighting of factors such as child poverty rates or regional cost variations can differ between Länder, reflecting their individual policy priorities and contexts.
2. Education resources to schools
Public funding for primary and lower secondary schools in Germany is decentralised: Länder fund teacher salaries and set standards, while municipalities handle infrastructure and operations. Funds are distributed based on student numbers and needs, ensuring free access with regional flexibility.
The Startchancen (Start-up Opportunities) Programme
Launched by the German Federal Ministry of Research, Technology and Space (BMFTR) for the period 2024-2034, the Startchancen (Start Opportunities) programme is a national initiative aligned with the Sustainable Development Goals (SDG 4), aiming to ensure inclusive, equitable quality education. Startchancen built on the 2019 Schule Macht Stark programme. It targets schools with high numbers of socially disadvantaged students, using a transparent, data-driven selection process carried out by the Länder. Key equity indicators—such as poverty rates and migration backgrounds—guide needs-based funding, replacing uniform per-student models with an approach tailored to address educational disparities. The programme covers all general education levels, with a strong focus on primary schools to build foundational skills and reduce the number of students falling below national standards in reading, writing, and math. It also supports secondary and vocational schools. Instead of offering financial incentives to teachers, Startchancen improves outcomes through systemic support, including expanded multi-professional teams, professional development, better collaboration, and upgraded infrastructure—prioritizing long-term, sustainable improvement in disadvantaged schools.
Länder - Hamburg Sozialindex
Many Länder provide extra resources for disadvantaged schools and some have had their own equity programmes providing extra resources, such as the Berlin Bonus-Programm. One of the first of these, Hamburg’s Sozialindex (originally KESS-Index), began in 1996 and ensures schools with greater needs receive more resources, leading to improved teacher student ratios in schools in deprived areas. Criteria for the 2021 index are non-German as a family language, SEN, proportion of children on benefits, characteristics of local neighbourhood.
3. Education resources to students and families
The Federal Training Assistance Act BAföG
The Federal Training Assistance Act (Bundesausbildungsförderungsgesetz, BAföG) in Germany, enacted in 1971, provides financial support to students who cannot afford the costs of their education and living expenses. It targets young people in need, including pupils, vocational trainees, undergraduates, and postgraduate students across various education levels. BAföG funding is means-tested, considering the income and assets of the student and their family, and typically includes a combination of grants and interest-free loans. Its education component enables equitable access to education by reducing financial barriers, thereby promoting equal opportunities regardless of social or economic background. The programme has continuously evolved over nearly five decades to better adapt to students’ needs, and recent reforms include a one-time grant of €1,000 for students from low-income households and extensions in funding duration to accommodate longer study times.
4. Social policies and family support programmes
Citizen’s Benefit (Bürgergeld)
The Citizen’s Benefit (Bürgergeld) programme, introduced in January 2023 and managed by the Federal Ministry of Labour and Social Affairs, provides targeted educational support to children and youth from low-income families to promote equal opportunities in schooling and social participation. Building on the earlier Education and Participation Package, it offers assistance for school supplies, trips, meals, tutoring, transport, and access to cultural and sports activities for eligible students under 25 in households receiving social assistance. Implemented locally through job centres and municipalities, the programme ensures ongoing support as long as the child remains in education and the family qualifies, emphasizing equity in basic education and reducing barriers for disadvantaged learners.
5. School meal programmes
Germany’s school meal programme, mainly in all-day schools (Ganztagsschulen), provides lunch and sometimes breakfast or snacks as part of the national “IN FORM” healthy nutrition plan (2008). Breakfast is offered in some schools via kiosks or cafeterias, but lunch is the main focus, especially with the 2026 rollout of guaranteed all-day care for primary students under the Ganztagsförderungsgesetz (GaFöG). Funding comes from states, municipalities, and parents, with low-income families supported by the Bildungspaket (Education and Participation Package). Meals follow the DGE Quality Standard (2023), emphasizing vegetables, whole grains, limited meat and sugar, and seasonal, regional products. Participation is voluntary and mostly paid by parents, but targeted subsidies ensure free or reduced-cost meals for children from low-income households. Nutritionists oversee compliance throughaudits, and schools involve stakeholders to meet guidelines.
This profile was reviewed by Prof Dr Silke Uebelmesser (Chair of Labour Economics / Public Finance, Friedrich Schiller University Jena).
