German Finance Minister vows no more relief for struggling households
Finance Minister Christian Lindner and Justice Minister Marco Buschmann – both of the liberal Free Democrats (FDP) – have signalled that government support for citizens fighting soaring costs is reaching its limit.
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High-ranking FDP ministers – whose party sits in Germany’s traffic-light government with the Social Democrats (SPD) and Greens – are trying to temper expectations that any big new spending measures are on their way to help relieve stretched German households.
FDP leader and Finance Minister Christian Lindner told Neue Osnabrücker Zeitung the government’s planned €200 billion for gas price controls and another €50 billion in planned citizen relief through 2024 had stretched government finances to their limits.
“I won’t exceed these limits,” Lindner told the newspaper. “We will already have an enormous general government deficit this coming year.”
Lindner added that he believed the German economy needed to grow more and become more competitive before more tax money could be redistributed, saying “we are growing poorer collectively.”
Buschmann says no to relief for “Indexmiete” rental contracts
Meanwhile, Justice Minister Marco Buschmann, also of the FDP – is opposing requests from his SPD coalition partner to act on “Indexmiete” rental contracts, which see their rent prices rise with inflation.
Many Indexmiete contracts were signed before the Ukraine war, back when inflation was at or even below two percent a year. With inflation regularly breaking at or near 10 percent most months in 2022, the SPD is concerned that tenants on Indexmiete contracts could soon see high rent increases they can’t afford as the new year kicks off.
“Over the past few years, tenants with index leases have mostly been better off than those with normal leases,” he told Rheinische Post. “That’s why tenant associations in particular have been positive about index rents until very recently.”
Calls for reforms are “counterproductive", Buschmann said. However, he vowed to keep an eye on how the issue developed in the future.
READ ALSO: German tenant groups see sharp increase in people who can’t pay utility bills
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High-ranking FDP ministers – whose party sits in Germany’s traffic-light government with the Social Democrats (SPD) and Greens – are trying to temper expectations that any big new spending measures are on their way to help relieve stretched German households.
FDP leader and Finance Minister Christian Lindner told Neue Osnabrücker Zeitung the government’s planned €200 billion for gas price controls and another €50 billion in planned citizen relief through 2024 had stretched government finances to their limits.
“I won’t exceed these limits,” Lindner told the newspaper. “We will already have an enormous general government deficit this coming year.”
Lindner added that he believed the German economy needed to grow more and become more competitive before more tax money could be redistributed, saying “we are growing poorer collectively.”
Buschmann says no to relief for “Indexmiete” rental contracts
Meanwhile, Justice Minister Marco Buschmann, also of the FDP – is opposing requests from his SPD coalition partner to act on “Indexmiete” rental contracts, which see their rent prices rise with inflation.
Many Indexmiete contracts were signed before the Ukraine war, back when inflation was at or even below two percent a year. With inflation regularly breaking at or near 10 percent most months in 2022, the SPD is concerned that tenants on Indexmiete contracts could soon see high rent increases they can’t afford as the new year kicks off.
“Over the past few years, tenants with index leases have mostly been better off than those with normal leases,” he told Rheinische Post. “That’s why tenant associations in particular have been positive about index rents until very recently.”
Calls for reforms are “counterproductive", Buschmann said. However, he vowed to keep an eye on how the issue developed in the future.
READ ALSO: German tenant groups see sharp increase in people who can’t pay utility bills
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