In its scramble for unity on tackling the ongoing cost of living and energy crises, as well as Russia’s war on Ukraine, Germany’s three-party government has come together for a two-day closed-door meeting outside of Berlin.
For the third time since taking office last December, Olaf Scholz’s “traffic light” cabinet retreats to the tranquil castle of Meseberg outside Berlin on Tuesday and Wednesday (30-31 August) to discuss “various domestic and foreign policy issues” in the words of a government spokesperson.
Amid rising energy and living costs, a coalition split over many issues, and intra-party discord around support for Ukraine, however, the meeting is likely to be far from tranquil.
One of the main points on the agenda is Germany’s “energy supply given the Ukraine war,” according to the spokesperson.
Leading voices from Scholz’s Social Democrats (SPD) and the Liberals (FDP) have already upped the pressure on Green energy and economy minister Robert Habeck regarding energy prices.
Energy ‘madness’
By the time of the retreat, “technical errors” in the design of the recently launched gas levy “should be eliminated,” FDP party whip Christian Dürr told daily Bild on Tuesday, while SPD party chief Lars Klingbeil told the newspaper during the weekend that Habeck’s plans had little to offer beyond “pretty words.”
The Green minister has been under fire since the launch of the levy, meant to help utilities cover the cost of replacing Russian supplies. But critics warned that even companies not in need but doing well financially could profit from the extra income.
Meanwhile, it has not been confirmed whether one of the coalition’s biggest current apples of discord will be discussed: the possible extension of nuclear power plants.
The Liberals are pushing to keep nuclear power plants on the grid for longer than planned to substitute Russian fossil fuels, and Scholz is yet to rule it out.
However, the Greens have kept up their staunch opposition, with foreign minister Annalena Baerbock recently calling the proposal “madness.”
Money squabbles
Disagreements within the governing coalition also extend to the state budget and the cost of living crisis.
While Scholz’ Social Democrats argue the state should continue to step in and financially support those struggling to cope with soaring inflation rates, the Liberals call to reign in spending to avoid both higher debt and extra taxes when families’ and companies’ budgets are already tight.
Despite billions of euros already having been spent on relief measures such as the €9 monthly public transport flat rate and a fuel rebate, finance minister and FDP party chief Christian Lindner stressed last week that he intends to return to the national debt limit, which has been suspended for the last two years in the face of the COVID crisis.
Accordingly, the FDP is the only coalition partner blocking proposals to extend the public transport subsidy in some form, called for by both Greens and Social Democrats to relieve consumers while nudging them to switch away from cars.
The SPD’s parliamentary faction recently put forth a list of measures they would like to see adopted during the government retreat. This includes a €49 transport flat rate and direct payouts to those most in need, such as welfare recipients, pensioners, or students.
“Nobody should be left alone. Strong shoulders will need to pull their weight,” the paper reads. In the eyes of the Social Democrats, these ‘strong shoulders’ should be those companies making extra profits in the face of Russia’s war in Ukraine.
The paper calls for a windfall tax to finance social support measures – an idea that the Liberals have completely rejected.
Cracks over Ukraine support
To top off the cabinet’s challenges ahead of its retreat, cracks have not only been showing between but also within parties as both Scholz and Lindner have been faced with critics of Germany’s support to Ukraine in their own ranks.
In an open letter made public on Friday, several SPD national and European lawmakers from the party’s pacifist wing called for a focus on a diplomatic agreement with Russia and to show more “caution” regarding weapon deliveries to Ukraine.
Meanwhile, FDP vice-leader Wolfgang Kubicki came under fire after he called to take the gas pipeline Nord Stream 2 into operation despite Russia’s continued attack on Ukraine, although Moscow is already sending less and less gas through the existing Nord Stream 1 pipeline.
[Edited by Nathalie Weatherald]
Source: euractiv.com
