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Merkel says major budget cuts on the horizon

DDP/DPA/The Local · 15 May 2010, 10:46

Published: 15 May 2010 10:46 GMT+02:00

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During her speech at Munich’s Ecumenical Congress, a meeting of Germany’s churches, Merkel said on Friday Germany had been living beyond its means for decades and must confront a central question in the coming weeks: “Where can we save?”

Deputy head of Merkel's conservative parliamentary group Michael Meister told daily newspaper Rheinische Post Saturday that Germany must cut costs by €15 billion in 2011 – and €45 billion through 2014.

Amid the current crisis with the euro currency, Merkel urged all euro zone countries to address their budget deficits in an interview with Munich daily Süddeutsche Zeitung.

“The problem has to be tackled at the roots, meaning countries have to bring national finances in order and must strive to improve their competitive edge,” she said.

Merkel also challenged suggestions made by fellow Christian Democrat Roland Koch, who recommended reviewing spending on education. “We’ve always said that the core of Germany’s future sustainability lies in education and research,” Merkel told the paper.

Koch has called on Germany’s coalition government to outline concrete savings targets and suggested that the federal government should review whether it could still afford its Kita day care centre guarantee plans.

“Here and there we’ve decided on programmes that will probably be much too expensive than first thought, such as the guarantee of day care for children under three,” he told daily Hamburger Abendblatt on Tuesday.

Koch also proposed extending the timeline on educational spending targets, which would see spending on schools and universities increase to 10 percent of the country’s gross domestic product.

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The pro-business free Democrats, junior coalition partner to Merkel’s conservatives, also rejected Koch’s recommendations. Economy Minister Rainer Brüderle (FDP) told mass circulation daily Bild that if Germany were to cut education spending, “we would be hurting ourselves immensely.”

Government spokesman Sabine Heimbach said no set decisions had been made on budget proceedings for 2011.

“On the other hand, it’s also clear that education and research are a point of emphasis for this coalition – and that’s evident in the coalition contract,” she said. “That also applies to expanding child care.”

DDP/DPA/The Local (news@thelocal.de)

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Your comments about this article

16:33 May 15, 2010 by cobalisk
Now that the NRW election is over, we can finally get to work on some policy. This 'wait and see' approach was costly to the CDU/FDP coalition, costly to the Euro due to an overzealous public row among ministers with little to do and costly to Germany in general because a static government gains no ground.

I think ending corporate welfare is a great place to trim the budget, that and re-regulating the energy companies so that their huge revenues can actually be put to work on green re-investment instead of simply being sloshed around in hedge funds and tax shelters.
17:44 May 15, 2010 by Bushdiver
I think trimming the unemployed benefits for the career unemployed plus the abuse by these people who abuse healthcare just because they don't feel like working would save many €. Does anyone smell a PKW Maut coming? I seem to recall reading here one time that Germans would be eager to pay more taxes than to lose some benefits. If Germany is that much in the hole, how and the hell can they give to much to bailout Greece? This hole thing stinks to me. I think the government is just positioning itself for more taxes. Bend over citizens of Germany. Oma Merkel has a surprise for you.
18:31 May 15, 2010 by Logic Guy
Well, if a government were to base their entire operation on an Efficient-Conservative structure, then it would never experiene a crisis. Problems only arise when they drift outside of this equation.
19:44 May 15, 2010 by ColoSlim
Does she coordinate her clothing with the background?
10:06 May 16, 2010 by JohnnesKönig
She also said she was going to cut taxes...
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