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KEY POINTS: Germany’s next government unveils coalition pact

From ambitious climate targets to reforming trans rights - here's everything you need to know about what Germany's next government wants to do while they're in power.

Traffic light coalition parties
Representatives of the three coalition parties that will form Germany's new government arrive at a press conference to reveal their coalition pact on November 24th, 2021. Photo: picture alliance/dpa | Kay Nietfeld

Hundreds of reporters crammed into Berlin’s Westhafen on Wednesday to find out what Germany’s next government has in store for the country over the coming years.

The coalition pact, which was thrashed out behind closed doors at a record-breaking pace, will determine Germany’s path over the coalition government’s four-year term in power.

It contains flagship policies from all three of the parties: a hiked minimum wage for the Social Democrats (SPD), a much earlier transition away from coal for the Greens, and steering clear of tax rises for the pro-business FDP.

But it also contains policies that all parties were in favour of, such as permitting dual nationality and legalising the recreational use of cannabis.

Describing the result of the negotiations to reporters gathered at the press conference, soon-to-be Chancellor Olaf Scholz said Germany’s next government would be a “coalition of equals” in which every party played to its strengths. 

READ ALSO: LATEST: Germany’s next government sets out roadmap for post-Merkel era

Here are the key policies you need to know as Germany enters the post-Merkel era. 

Carbon neutrality by 2045 

As you might expect for a coalition involving the Greens, the climate crisis has taken centre stage in the 177-page pact set out by the three ‘traffic light’ coalition parties. 

In their agreement, the parties have pledged to phase out coal by 2030, eight years earlier than the target set by the previous conservative-led government. 

The Social Democrats, Greens and liberal FDP are aiming to “bring forward the coal phase-out to 2030 ideally and leave combustion engine technology behind”, the document said, adding they would also seek carbon neutrality by 2045.

A wind farm in Schleswig-Holstein.
A wind farm in Schleswig-Holstein. The traffic light coalition wants to source 80 percent of Germany’s energy from renewable sources by 2030. Photo: picture alliance/dpa | Christian Charisius

In a nod to the innovation-focused politics of the FDP, the parties also want to use 3.5 percent of GDP for investments in research and development that will speed up the transition to a carbon-neutral economy.

By 2030, 80 percent of Germany’s electricity should come from renewable sources such as wind and solar, the coalition revealed. That’s a significant jump up from the previous target of 65 percent.

“All suitable roof surfaces will in future be used for solar energy. For new commercial properties that will be compulsory, while for private new buildings, that will become the rule,” the parties said.

With an eye on Germany’s powerful automotive industry, the parties agreed that electric cars should number 15 million by 2030 from roughly one million currently, as combustion engine vehicles will no longer receive approval from 2035.

Caps on borrowing, no tax rises

Throughout the coalition negotiations, there was speculation that the Greens’ co-leader Robert Habeck and FDP leader Christian Lindner had each set their sights on taking control of the coveted Ministry of Finance.

Looking at the outcome of the talks on Wednesday, it’s clear who won the struggle: the FDP will be heading up the ministry, with Lindner taking on Olaf Scholz’s former job as Finance Minister. Accordingly, the coalitions’ fiscal plans have the FDP’s fingerprints all over them.

To start with, the parties have pledged to reinstate the country’s so-called debt brake, which limits the amount the state can borrow, by 2023. It was put on hold to allow for crucial public spending during the Covid crisis. 

Maintaining the debt brake was a red line for the FDP, and Social Democrat Finance Minister Olaf Scholz – who will be Germany’s next chancellor – has also long been an advocate of the rule.

The parties also agreed to not raise taxes during their mandate, according to a tweet by FDP leader Christian Lindner – a win for his party which has refused to raise any fiscal pressure on taxpayers.

Abortion and trans rights

As you might expect for a liberal-leaning coalition, the traffic light has pledged to expand some civil liberties with proposals to ease strict rules on abortion and gender transitions.

In a key move for women and healthcare professionals, the parties have pledged to abolish paragraph 219a, a controversial piece of Nazi-era legislation that makes it illegal to advertise abortion services.

“Doctors should be able to provide public information about abortions without fear of prosecution,” they say in the document.

Trans Pride in Germany
Numerous protestors gather at a demo in favour of trans rights in Oldenburg, Lower Saxony. Photo: picture alliance/dpa | Mohssen Assanimoghaddam

In addition, the SPD, the Greens and the FDP plan to replace the controversial Transsexuals Act “with a self-determination law”. This would include “a procedure at the registry office that makes changes to gender possible in principle by means of self-disclosure”.

In other words, it could soon become much easier for people to change their officially recorded gender. 

Legalising recreational cannabis 

Going one step further than the 2017 legislation that allowed cannabis for medical use, Germany’s new government wants to legalise the recreational use of cannabis. 

“We will introduce the controlled distribution of cannabis to adults for consumption purposes in licensed stores,” the parties say in the document. “This will control the quality, prevent the circulation of contaminated substances and ensure the protection of minors.”

READ ALSO: How Germany’s next government is planning to legalise cannabis

The Greens and FDP have long been pushing to legalise cannabis, while the SPD has proposed testing regulated distribution of the drug in pilot projects. Under plans leaked last week, the government will conduct a review four years after legalisation cannabis to see what the impact of the policy has been. 

Permitting dual citizenship 

As The Local reported on Wednesday, it appears that the three coalition parties have stuck to their promise to eliminate key hurdles to gaining German citizenship.

According to the coalition pact, immigrants will soon be entitled to apply for German citizenship after five years – or three if they can demonstrate high levels of integration. At present, most immigrants must wait between six to eight years before they are able to apply for citizenship. 

Dual Turkish and German nationality
A Turkish and a German passport are held side by side. For a long time, Germany has forbidden dual nationality for non-EU citizens. Photo: picture alliance / Carsten Rehder/dpa | Carsten Rehder

In a key move for non-EU citizens, the parties revealed in the coalition pact that they would change the law to allow the holding of ‘multiple citizenships’, suggesting that dual nationality will be permitted during the next legislative period. 

Currently, non-EU citizens who did not grow up in Germany must generally choose between German and foreign citizenship.

READ ALSO: Germany’s coalition government to allow dual nationality

Social security and wages 

The SPD will be taking over the Ministry for Labour and Social Affairs – and it’s clear to see the influence of the centre-left party in the policies that have emerged around benefits and wages.

From next year, the traffic light coalition say they will bump up the minimum wage from €9.60 to €12 an hour. This was one of the SPD’s flagship policies at the last general election.

In addition, the much-maligned Hartz IV unemployment benefit will be scrapped in favour of a more user-friendly Bürgergeld (Citizens’ Fund). People without jobs will be able to sign up for this type of financial support quickly and digitally, and the parties have pledged that people won’t be asked to justify the size of their flats or dig into their savings for the first two years of claiming it.

Another Greens and SPD policy is the introduction of Basic Child Insurance, which will condense the piecemealed forms of social support into one lump sum that should cover children’s basic needs until the age of 18. 

Tackling the housing crisis

Under plans to combat the country’s ever-worsening housing crisis, the new government will build 400,000 new flats each year, 100,000 of which will be publicly-funded social housing for people in lower income groups. They say this plan will help both renters and the construction industry. 

The parties also plan to tighten the so-called ‘rent brake’, a federal law aimed at limiting the amount a landlord can increase the rent on a property. 

Construction site in Mainz
A block of flats is built in Mainz. The new government plans to build 400,000 new homes a year. Photo: picture alliance/dpa | Sebastian Gollnow

While the current law restricts rent rises to 15 percent over a three year period, the government’s new plan will be to restrict rises on rent to 11 percent in tighter housing markets, such as those in many of the country’s larger cities. 

Although further details of the proposal have yet to emerge, the 11 percent cap is closer to that put in place in the capital of Berlin in 2020, which was later overturned by the federal court. 

READ ALSO: REVEALED: How Germany’s new government wants to tackle the housing crisis

Lowering the voting age 

In a sweeping change to Germany’s electoral law, the parties have greed to lower the voting age from 18 to 16.

The plans are likely to favour the Greens and FDP which are the two most popular parties among young voters, and that could cause problems for Angela Merkel’s conservatives, who are largely backed by Germany’s army of pensioners – though many older voters switched to Scholz’s SDP at the last election.

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Green ministers outshine Scholz as stars of German government

Eclipsed by two Green party ministers over his response to the war in Ukraine, Chancellor Olaf Scholz is battling to wrest back public approval - starting with a speech to parliament on Thursday.

Green ministers outshine Scholz as stars of German government

Scholz, whose Social Democrats (SPD) are in power with the Greens and the liberal FDP, has faced a barrage of criticism over his perceived weak response to the war, including his hesitancy over sending heavy weapons to Ukraine.

Meanwhile, Green party Foreign Minister Annalena Baerbock and Economy Minister Robert Habeck have impressed with their more vocal approach, topping a recent survey of the country’s most popular politicians.

Scholz’s party suffered a crushing defeat in a key regional election at the weekend, losing to the conservative CDU with its worst-ever result in Germany’s most populous state of North Rhine-Westphalia.

The Greens, meanwhile, almost tripled their score compared with five years ago to finish in third place and look almost certain to be part of the next regional government.

READ ALSO: Why the Greens are the real winners of Germany’s state elections

Der Spiegel magazine called the result a “personal defeat” for Scholz after he was heavily involved in the election campaign, appearing on posters and at rallies.

Already famous for his lack of charisma before he became chancellor, Scholz now appears to be paying the price for dragging his feet in dealing with Moscow over fears of escalating the crisis.

In a bid to win back the public, Scholz has in recent days given lengthy television interviews.

On Thursday, he will be explaining his policy to lawmakers ahead of the EU summit at the end of May.

Chancellor Olaf Scholz (m) with ministers (l-r) Svenja Schulze, Annalena Baerbock, Robert Habeck, Cem Özdemir and Christine Lambrecht at a meeting in May 2022.

Chancellor Olaf Scholz (m) with ministers (l-r) Svenja Schulze, Annalena Baerbock, Robert Habeck, Cem Özdemir and Christine Lambrecht at a meeting in May 2022. Photo: picture alliance/dpa | Kay Nietfeld

Sitting tight

In a devastating reading of Scholz’s outings so far, the weekly Focus assessed that “his language is poor, his facial expressions monotone and his body language too understated.”

According to Der Spiegel, the chancellor’s communications strategy seems to revolve around one mantra: “Repeat, repeat, repeat.”

Other media have accused him of stubbornly sticking to the same plan and ignoring what is going on around him.

“His party is plummeting, but the chancellor feels that he has done everything right… Doubts and questions rain down on him, but Olaf simply sits tight,” said Der Spiegel.

Scholz’s spokesman Steffen Hebestreit has defended the chancellor, suggesting that the public value his calm demeanour and would find it “inauthentic” if he tried to turn himself into Barack Obama.

READ ALSO: How war in Ukraine has sparked a historic shift in Germany

But for political scientist Ursula Münch, Scholz does not come across as calm and measured but rather “imprecise” compared with his colleagues from the Green party.

Scholz has also not been helped by the fact that Defence Minister and fellow SPD politician Christine Lambrecht is currently caught up in a storm of criticism for allowing her son to accompany her on a government helicopter on their way to a family vacation.

‘Strong moral underpinning’

Baerbock, meanwhile, has turned around her public image after a series of blunders during the 2021 election campaign, coming across as clearer and more decisive than Scholz in her response to the Ukraine crisis.=

The 41-year-old former trampolinist has become the face of Germany at international summits, from the G7 to NATO, and in early May became the first German minister to visit Kyiv.

Habeck, meanwhile, has impressed with his dedication to weaning Germany off Russian energy.

And their meteoric rise is all the more surprising given the Green party’s traditional positioning as a pacifist party opposed to sending weapons to conflict zones.

For the first time in their 42-year history, according to Der Spiegel, the Greens are being judged not on “expectations and promises” but on their performance in government.

“The strong moral underpinning of the Greens’ policies and the fact they openly struggle with their own principles comes across as approachable and therefore very credible,” according to Münch.

“Of course, this increases their clout compared with the chancellor.”

She therefore predicts an “increase in tensions” between the Greens, the SPD and the FDP, with life not expected to get easier for Scholz any time soon.

By Mathieu FOULKES