German Chancellor Friedrich Merz (CDU) has advocated for the reform policy of the black-red coalition one year after taking office. "The coalition is determined to make decisions, and despite all discussions, it is capable of making decisions," Merz stated on Wednesday during an address to business leaders in Düsseldorf. "We can reach compromises within the coalition."
The Chancellor pointed to upcoming reforms in healthcare and pension insurance, as well as the planned tax reform. However, in energy policy, he called on the SPD to show greater willingness to compromise.
"We must be prepared to make changes in order to preserve what is truly important to us together," the Chancellor emphasized at the North Rhine-Westphalia Entrepreneur Day. Given geopolitical upheavals and accumulated structural problems, Germany faces pressure to act "that is probably the greatest we have seen in recent decades, if not since the end of the Second World War."
Merz renewed his call for longer working lives to ensure the continued financing of social security systems. For the upcoming reforms in healthcare and pension insurance, the goal is to prevent contributions from rising further. "But that will only work (...) if we work more and at the same time enable better capital-funded retirement provisions."
The pension insurance reform, for which an expert commission is expected to submit proposals in the coming weeks, will be "the toughest nut to crack in the coming months," the Chancellor said.
"Working people" in Germany should be unburdened, while the government wants to "finally take an honest look at the age structure of our society." Life and work must be brought "into a sustainable relationship with each other," the Chancellor stressed. "We cannot simply continue as we have for the last 20 years."
Together with coalition partner SPD, he is striving for a reduction in income tax, "especially and above all for partnerships and medium-sized businesses." An increase in income tax at the expense of the middle class and partnerships would not be possible with him as Chancellor.
On energy policy, Merz backed Economy Minister Katherina Reiche (CDU) and her plans for grid expansion and the planned reform of the Renewable Energy Sources Act (EEG). Reiche has made proposals aimed at greater cost efficiency. "I appeal to the Social Democrats to follow us on this path," the Chancellor said. "This is not about slowing down the expansion of renewable energies.
On the contrary, we are committed to further expanding renewable energies." However, base-load capable power generation is needed. Merz also held his coalition partner accountable for the planned expansion of infrastructure.
The Infrastructure Future Act, already approved by the cabinet last year, has still not been passed by the Bundestag "because there are parts of the coalition who believe that what we have written down there, namely an overriding public interest in this infrastructure expansion, should now be undermined by a nature conservation area requirement law." He appealed to the Social Democrats to enable a decision in parliament so that the allocated funds can also be deployed.
For July 15, Merz announced another so-called relief cabinet meeting. In this cabinet session shortly before the parliamentary summer recess, measures to reduce bureaucracy are to be approved. More than 20,000 proposals have already been collected in a specially created portal. These are to be evaluated with AI support in order to "quite concretely simplify legislation and enable relief for the economy and for companies in Germany."
Merz appealed for patience regarding further reform steps. The projects cannot be implemented "overnight, not with one big stroke." This can only work "in a form in which all arguments are heard, weighed, and all interests are also heard. That means democratically." Everyone must contribute "to get a lot in return, namely the future viability of our country."
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