Germany plans €822 billion economic aid package to fight coronavirus crisis

The German government is planning an economic aid package worth €822 billion to prevent companies from going under during the coronavirus pandemic.

Germany plans €822 billion economic aid package to fight coronavirus crisis
Photo: DPA

The money will go to fund the country's fight against the coronavirus pandemic, according to a draft bill seen by AFP Saturday.

What's the latest on coronavirus in Germany and what do I need to know?

To finance the extraordinary measures ranging from partial nationalisations to credit guarantees to salary top-ups for workers forced into part-time, the government will also shed its debt averse attitude.

Not only will Merkel's government drop its dogma of keeping the budget balanced, it will go a step further to seek permission from parliament to raise the legal limit on its annual borrowings.

Merkel's government will seek to borrow 156 billion euros for 2020, a sum that exceeds a constitutional limit by 100 billion euros.

Faced with the coronavirus pandemic which has brought all travel to a standstill, forced employees into working shorter hours and left most shops shut, Merkel has vowed that Germany will do whatever it takes to preserve its economy.

“We will do what we can to get through this situation well, and we will see at the end of that where our budget stands,” she had said last week, stressing that ending the virus crisis “comes first”. 

'Not predictable'

With public life all but shut down, the government expects 33.5 billion euros less tax intake than previously budgeted in its 2020 accounts.

“The economy and the job market are severely impacted by the measures taken nationally and internationally to curb the pandemic,” according to the document seen by AFP.

“In the current situation, the duration of the pandemic and the measures tied to it are not predictable.”

To ensure that businesses do not go under, the government is earmarking 400 billion euros to underwrite their debt or offer recapitalisation that could lead to partial state takeovers, according to the draft bill.

The plan is to be debated by the cabinet on Monday before it is put before parliament later in the week.

Operators in the tourism and service industries are among likely candidates for state help, as they count among those hardest hit by the pandemic which has put much of Europe in lockdown.

Tourism and hotel group TUI has said it was applying for state aid to keep it afloat, as it suspended the “majority” of its operations over the virus.

German airline giant Lufthansa meanwhile has been forced to scrap most of its flights in coming weeks as several countries including the United States ban travellers from Europe.

Germany's so-called “debt brake” was written into its constitution in 2009, and limits a federal budget deficit to 0.35 percent of GDP.

The limit can be exceeded only in emergencies, for instance in natural disasters or other extraordinary situations that significantly impact the country's finances.

Beyond the “debt brake”, keeping the budget of Europe's biggest economy balanced is a key campaign promise of Merkel's party.

The self-imposed dogma of maintaining a “black zero” has been a constant source of friction with other European countries, including France, which argues that Germany should invest more to help the eurozone bolster its economy.

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EXPLAINED: The new rules around getting a sick note over the phone in Germany

Due to high Covid infection numbers throughout the summer, it’s now possible to get a sick note from a doctor over the phone again for some illnesses. Here’s what you need to know.

EXPLAINED: The new rules around getting a sick note over the phone in Germany

What’s happened?

In spring 2020, German authorities changed the law so that people with a mild upper respiratory tract illness, such as the common cold, were able to get an incapacity to work certificate or AU-Bescheinigung by simply calling and speaking to their GP.

The rule was extended several times and finally reversed on June 1st this year due to falling infection figures. Since then people have had to go back to the practice – or do a video call if the doctor’s office has that system in place – to get a sick note.

Now, due to a decision by the Joint Federal Committee, the regulation has been reintroduced and patients can call their GP again for a sick note.

Can I get a sick note over the phone for any illness?

No. As before, the regulation only applies to patients suffering from a mild upper respiratory tract illness. Though Covid has not explicitly been named in the announcement, it seems that it is intended to be covered by the regulation.

If the doctor is convinced that the patient is unfit for work after a telephone consultation, then they can issue a sick note for up to seven days.

READ ALSO: EXPLAINED: The changes around doctor’s notes in Germany you should know

If the symptoms persist after seven days, the certificate can be extended once more for another week.

Why now?

According to the Chairman of the G-BA, Josef Hecken, the regulation has been introduced now as a response to rising Covid numbers and in anticipation of the cold and flu season in the coming months: “We want to avoid full waiting rooms in doctors’ offices and the emergence of new infection chains,” he said.

The telephone sick leave rule is a simple, proven and uniform nationwide solution for that, he said. The rule is also necessary because video consultation hours are not yet available everywhere.

What else should I know?

The health insurer DAK is calling for telephone sick leave in the case of light respiratory diseases to be made possible on a permanent basis in Germany. DAK’s CEO Andreas Storm said that this should “not always be up for debate, because it has proven itself.” 

READ ALSO: Everything you need to know about making a doctor’s appointment in Germany

The social association VdK also welcomed the reintroduction of the rule. The VdK’s President Verena Bentele said that the regulation would help to protect high-risk groups in particular from potential infections.

What are the rules to know about sick notes in Germany?

Germany has a strict system in place. If you are sick, you need to give your employer a Krankmeldung (notification of sickness) before the start of work on the first day (of your illness).

However, you also need to hand in a Krankschreibung (doctor’s note) on the fourth day of your illness. Some employments contracts, however, require you to submit a sick not earlier than the fourth day so check with your boss or HR on that point.