Germany debates who should cover the costs of unhealthy eating

When Mr Lucas Pohl boarded a flight last summer, he did not know it would mark a turning point in his life. The Berlin resident had always carried extra weight, but when he could not fasten his seatbelt and had to ask for an extender, “something inside me broke”, said the 27-year-old.

Mr Pohl, who weighed about 150kg at the time, had been eating mostly cheap junk food and ready-made meals while earning €1,000 (S$1,500) a month as a trainee. Fearing for his health, he checked into an obesity clinic.

“I wasn’t sure how much longer my body could take it,” he said.

Public health insurance in Germany does not pay for the use of drugs such as Ozempic and Wegovy for weight loss, but Mr Pohl was able to access nutritional counselling and bariatric surgery.

His insurance covered the costs, which came to more than €10,000 in total, and he continued to receive his salary during his three-week leave after the procedure. 

About half of adults in Germany are overweight, with obesity rates projected to keep rising if current trends continue. Researchers have linked this to Germans’ low vegetable intake and sugar-heavy diets.

In a country where mandatory insurance means healthcare costs are shared by the public, the lack of oversight around unhealthy food is a political issue.

Obesity and its associated diseases not only “cause a great deal of human suffering, they also incur extremely high costs”, said German Diabetes Society managing director Barbara Bitzer.

Estimates put the economic toll of weight-related health problems at between €27 billion and more than €90 billion a year, further straining a system already under financial duress.

Chancellor Friedrich Merz promised to initiate a “fundamental reform” of social security systems in 2025, yet a policy plan released in spring by the ruling coalition made no mention of nutrition or unhealthy eating, which directly impact healthcare costs. Instead, it called on consumers to “make their own decisions”.

For members of the Greens and the Left, that is not enough.

Instead, the parties are pushing measures such as sugar taxes on soft drink-makers – an effort the conservative Christian Democratic Union (CDU)/Christian Social Union opposes, trusting markets to self-correct.

At a moment in which much political discourse in Germany is focused on the divide between populist factions and establishment parties, the debate over food regulation shows the classic tension between market freedom and state intervention is still very alive.

Germany has long taken a hands-off approach to regulating industries associated with health risks, such as tobacco and alcohol.

Ms Christina Stumpp, a member of the parliamentary food and agriculture committee in Mr Merz’s ruling CDU, explained how this thinking extends to food.

Because increasingly health-conscious consumers will encourage producers to reduce sugar and fat in their products, she said, there is no need for outside intervention.

“I think competition regulates a lot of this,” she added. 

That view is shared by industry lobby groups such as Lebensmittelverband and Wirtschaftliche Vereinigung Zucker, which say people should be allowed to choose what they eat without government interference. 

To some politicians on the left, however, deferring to individual choice sounds like a dodge.

Ms Ina Latendorf, food and agriculture spokeswoman for Die Linke in Parliament, said: “They always bring up freedom, and then the responsibility gets passed on to consumers.”

She also noted that industry groups hold significant sway in German politics. In 2024, McCafe, which is owned by McDonalds, was one of the sponsors for the CDU’s annual party convention.

While Germany does not levy so-called “sin taxes” on products deemed harmful, it does have a system in which foods are taxed at either 7 per cent or 19 per cent depending on whether or not they are considered essential.

The idea is to ensure that basic necessities are always affordable, yet critics have attacked the value-added tax (VAT) model as full of inconsistencies, noting that pet food falls into the cheaper tax bracket while baby food does not.

Having failed to make significant steps in food legislation during their four years in the previous government – an outcome they have blamed on their pro-market coalition partner – Greens lawmakers are once again calling for VAT reform.

In this, they do have public support. An effort to remove the VAT on healthy foods has been met with 91 per cent public approval. Separately, a proposed sugar tax on soft drink-makers has the backing of 79 per cent of Germans.

Balance sheets do suggest that giant companies like Unilever Plc, which owns Magnum ice cream, and Nestle SA, maker of KitKat, have little incentive to change the way they do business without government or economic pressure.

In 2024, 41 per cent of Nestle’s food and beverage sales came from products considered unhealthy, with percentages even higher among some rivals.

The groups say they are working on healthier options.

A Nestle spokesperson highlighted the company’s efforts to cut sugar and create new products that assist with weight loss.

Danone, which reports having one of the healthier portfolios among peers, said it is rolling back sugar levels in products marketed to children, such as its Danonino yogurt snacks. Still, critics counter that progress has been slow. 

So long as unhealthy foods keep flying off shelves, experts maintain that it is unrealistic to expect businesses to act against their own profit motives.

Dr Marion Nestle, a professor emerita of nutrition at New York University who has no relation to Nestle SA, said: “Food companies are not social service agencies, they’re not public health agencies, they’re businesses with stockholders to please.”

She pointed to the strong track record in Latin America in legislating the sale and marketing of junk food.

In 2016, Chile curtailed certain kinds of food advertising and mandated front-of-pack warning labels on products containing high levels of sugar, calories, sodium and fat.

According to a study published five years later, those measures helped significantly decrease sales of unhealthy food.

Similar effects have been seen in the UK, where a tax on sugar reduced its content in soft drinks by 29 per cent. In Germany, a campaign to get soda companies to voluntarily bring down their sugar levels led to a reduction of just 2 per cent.

Instead of allowing industry to police itself, German Diabetes Society’s Professor Bitzer believes politicians should take action to ensure that food manufacturers are on the hook for guaranteeing that their products are healthy.

That would not only ease individual suffering and healthcare expenses, she said, as research shows that it could also help with Germany’s economic woes.

Cutting calories in unhealthy foods by just 20 per cent could increase employment and productivity in the country by the equivalent of 29,000 full-time workers per year, according to a report by the Organisation for Economic Cooperation and Development.

“It doesn’t cost much, but it requires political courage,” Prof Bitzer said. “And that is lacking at the moment, and has been for many years.” BLOOMBERG