Federal Government | Coalition committee meets under difficult conditions

Lars Klingbeil, Federal Minister of Finance, and Federal Chancellor Friedrich Merz have different perspectives on the further course of the reform. Photo: dpa/Michael Kappeler For the first time in a good three months, the leaders of the Union and SPD will meet for a coalition committee in the Chancellery on Wednesday evening. After the heavy losses in the state elections in September and several open conflicts within the coalition, the main focus will be on how the governing parties want to advance their plans in the coming weeks. Rather, there is an agreement on how to proceed and possibly a timetable.

SPD parliamentary group leader Matthias Miersch announced a “very honest discussion” about how the coalition wanted to tackle its tasks in the next few months. However, he does not expect any decisions on the controversial reform projects. Union faction leader Thorsten Frei (CDU) said it was about determining “in what order” the large mountain of work should be processed. It is crucial for the people that the projects that have already been agreed are now implemented.

This means that different expectations meet at the first coalition committee after the summer break. At the beginning of July, the Union and the SPD agreed on a comprehensive reform package that includes, among other things, pensions, taxes, care and the labor market. At the end of August, the parliamentary group leaders agreed to implement the package by the turn of the year. However, after the government parties' election defeats in September, the SPD and various parts of the CDU are calling for changes. In particular, the reform course should not primarily result in cuts.

The dispute is particularly clear when it comes to pension reform. The Union is pushing Labor Minister Bärbel Bas (SPD) for a draft law. Economics Minister Katherina Reiche (CDU) recently publicly called on Bas to submit the law quickly. The package must be decided by the end of the year, she said. Union parliamentary group vice-president Johannes Winkel also called for a draft that implements the pension commission's recommendations.

Bas will not take part in the coalition committee due to a bereavement in her family. At the same time, the planned abolition of the pension without deductions after 45 years of contributions is particularly controversial within the SPD. Hardship and transitional regulations are planned. How these will be designed and whether other parts of the commission's recommendations will be changed remains to be seen.

The Union fears that the jointly agreed reform package will be weakened. According to a report in “Bild”, the Union side should therefore push for a date to be set in the coalition committee for the presentation of the pension bill. The newspaper also reported on an appeal from Chancellor Friedrich Merz (CDU) to his own parliamentary group to stick with the reform plans.

There are also different ideas when it comes to labor market reforms. The Union and the SPD have fundamentally agreed on greater flexibility, including when it comes to fixed-term contracts. There is still a dispute over the change from daily to weekly maximum working hours as provided for in the coalition agreement. A first bill from the Ministry of Labor provided for a stronger link to collective agreements and electronic working time recording. In contrast, there was criticism from the Union and employers' associations.

Tax policy is also a controversial topic among the governing parties. The coalition had agreed on additional revenue, among other things, through a sugar tax. However, a draft by Finance Minister Lars Klingbeil (SPD) was stopped by the Chancellery. The Union accused the Finance Minister of going beyond the agreement when designing it. The SPD, in turn, points out that the income is planned for budget planning.

Things are no different with income tax. The SPD is open to a higher relief volume, but is demanding proposals from the Union for counter-financing. At the same time, the Union faction called for relief to be made possible through spending cuts. According to a report in the “Handelsblatt”, the Union parliamentary group leadership discussed only agreeing to the income tax reform in the Bundestag if Bas presented draft laws on pensions and the labor market.

In addition to the reforms, dealings with the AfD are likely to be a topic of conversation. On Tuesday, Tobias Rausch, an AfD politician, was elected president of a German state parliament for the first time in Saxony-Anhalt. Rausch received 48 of 82 votes. The AfD and BSW together only have 44 mandates. The BSW had announced its support for Rausch. The CDU parliamentary group had recommended that its 15 MPs abstain - in fact there were only five abstentions.

This leaves four votes mathematically unexplained. It is impossible to determine whether CDU members voted for Rausch because the vote was secret. Union parliamentary group leader Frei described speculation as such, but at the same time explained that the fact of the additional votes was “highly questionable and worrying”.

For the SPD, the process is directly a federal issue. SPD leader Lars Klingbeil demanded an explanation from the CDU and BSW as to how the additional votes came about. SPD parliamentary group leader Miersch has already announced that he will address the election in the coalition committee. The CDU must explain how this result could have come about, said Klingbeil.

The election also comes at a time in which the Union's so-called firewall against the AfD is being questioned, particularly by the East German CDU state associations. It is questionable whether Friedrich Merz is able to enforce party discipline on this point. In Saxony-Anhalt, the AfD won the state elections by a wide margin. There is now speculation as to whether their top candidate Ulrich Siegmund could get a majority in the planned prime ministerial election in December.

The coalition committee is therefore faced with a long list of open questions. At the same time, the political pressure on the Union and the SPD is growing. The election results in Saxony-Anhalt, Mecklenburg-Western Pomerania and Berlin have triggered debates in both parties about the government's course. In this tense situation, Friedrich Merz (CDU) is trying to convince his own faction to follow a common course. According to a report in "Bild", the Chancellor appealed to MPs to stick with the reforms: "We have to get it done together." The successful agreement on care must also be achieved on pensions.

Brandenburg's Prime Minister Dietmar Woidke (SPD) and Brandenburg's Interior Minister Jan Redmann (CDU) have therefore already called for a "radical about-face" by the federal government and an end to party-political disputes. Federal President Frank-Walter Steinmeier also recently called on the government to cooperate. He spoke of a profound crisis and called for political will to abandon established routines.

Another report from “Bild” provides additional excitement. Accordingly, the coalition committee could also be about the fundamental basis of trust between the Union and the SPD. The newspaper spoke of a possible "kind of question of trust" - from both sides: "Behind the scenes there are suspicions of a coup, blocked reforms and questions of power." The statements cannot be independently confirmed.

The “Frankfurter Allgemeine Zeitung” also reports rumors that Merz could ask parliament for a vote of confidence in connection with the budget. According to the FAZ, government circles say that the vote on the budget is a question of trust. The doubts on both sides about the coalition's cooperation now seem to have grown. For example, after the disastrous election results in Berlin and Mecklenburg-Western Pomerania, the chairman of the CDU Hamburg, Dennis Thering, called on Merz to ask the vote of confidence to implement the reforms: "If the question of trust is needed for the further reform course: Yes, then it has to be asked by Friedrich Merz." It remains to be seen whether the coalition committee will ultimately exhaust itself in internal disputes or will agree on concrete steps. With agencies.

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