Reform package: Germany back on track?
The leaders of the governing coalition in Berlin have agreed on a comprehensive reform package. The 34 measures in areas such as taxation, the pension system, labour law, innovation and red-tape reduction are intended to boost the economy and stabilise German society. "We want to get Germany back on its feet," stressed Chancellor Friedrich Merz. The media take stock.
At least a no-fuss agreement
Der Standard comments:
“This package could mark a turning point. Just as the pensions committee did before it, the coalition in Berlin has once again reached an agreement without a fuss. Unlike in the past, there were no insults or arguments. Merz and his team wanted – and needed – to show that they really could achieve something. Pensions, healthcare, taxes, the labour market: the black-red coalition has now made progress on all fronts. But the real test in the Bundestag is yet to come. And if that goes well, then the mood in Germany could indeed improve – even without a World Cup victory.”
A new sound
Welt sums up:
“This new sound, to which Vice-Chancellor Klingbeil has is also attuned, reflects a reduced distrust of businesses on the part of the state and will save companies an enormous amount of time and money. In particular for small and medium-sized enterprises, the ever-increasing regulatory requirements have become almost impossible to cope with, which is why companies consistently cite bureaucracy as one of Germany's greatest weaknesses as a business location. ... The tax plans announced by Merz and Klingbeil come as a disappointment to many citizens. ... But at least the CDU/CSU leadership has prevented the SPD from pushing through its far more sweeping redistribution fantasies.”
No reform for young people
Tagesspiegel is disappointed with the tax reform:
“The increase in the tax rate for the wealthy is merely cosmetic, while the top tax rate remains untouched. Wealth and inheritances also remain virtually untouched in tax haven Germany. ... The fact that average families could have an additional 600 euros at their disposal is to be welcomed in a country where care work is still mostly left to parents. However childless people, singles and above all young people are practically left empty-handed with this tax reform. ... What do they gain from this major reform package? They will no longer be able to call in sick by telephone and will have to provide a doctor's sick note from the very first day.”
Just a hop on the spot so far
The Neue Zürcher Zeitung insists that bolder reforms are needed:
“To truly get Germany back on track, the government would have to do much more. It would have to drastically scale back state influence over the economy instead of further expanding it – as planned – by setting up a state-owned housing association and pursuing a runaway subsidy policy. Only when government spending falls relative to economic output can entrepreneurship, economic dynamism and prosperity flourish again. Unfortunately, there is no sign of this happening. The government's reform package can therefore only be the start, which must be followed by further steps. Otherwise, the intended 'great leap forward' risks ending up as nothing more than a hop on the spot.”
Galvanised by the right-wing populists
La Stampa fears that the reforms come too late to prevent an AfD election victory:
“The latest polls put the far right at 41 to 42 percent [in some federal states] and the CDU/CSU at 24 to 26 percent – a gap that will no doubt be difficult to close. At the very least, it has given the federal government some fresh impetus: yesterday it presented a package of reforms that is clearly aimed at averting the impending defeat. ... Will it be enough? Probably not – mainly because the time it will take for the reforms to take full effect and start showing results does not coincide with the timing of the elections.”