Monday 20 November 2017

Merkel strikes wage deal as price for government

German Chancellor Angela Merkel looks on as chairman of the Social Democrats (SPD) Sigmar Gabriel (left) and chairman of the Bavarian Christian Democrats (CSU) Horst Seehofer shake hands after they signed the deal. Sean Gallup/Getty
German Chancellor Angela Merkel looks on as chairman of the Social Democrats (SPD) Sigmar Gabriel (left) and chairman of the Bavarian Christian Democrats (CSU) Horst Seehofer shake hands after they signed the deal. Sean Gallup/Getty

Matt Tempest Berlin

ANGELA Merkel, the German chancellor, has been forced to accept plans for the country's first minimum wage as the price of a "grand coalition" deal with the opposition Social Democrats.

The Christian Democrat Union chief must wait to discover whether her new coalition partner's rank-and-file will approve the power-sharing pact and see her sworn in for a third term as chancellor.

Despite a convincing victory in the September 22 election, Ms Merkel fell just short of an absolute majority -- necessitating a fresh coalition, but with a greatly weakened Social Democrat Party (SPD).

"During the negotiations we came up with very different ideas -- that is why it has taken a while," Ms Merkel joked at a press conference.

NUCLEAR

The delay resulted in the unusual spectacle of the incumbent foreign minister Guido Westerwelle last week helping conclude nuclear talks with Iran in Geneva -- despite his party being turfed out of the Bundestag by voters in September.

"We are a grand coalition in order to tackle the big tasks for Germany: sound finances, solid prosperity and social security," Ms Merkel added.

After two months of negotiations, culminating in 17-hour overnight talks, the 185-page deal was struck around 5am Berlin time yesterday.

It gives the SPD its demand for a nationwide €8.50 minimum hourly wage -- which some critics have warned may cost jobs.

The deal may also eventually see tolls for foreign drivers to use the autobahns -- a controversial measure that is yet to be approved by the European Union.

Ms Merkel's CDU has sold the deal as "No new debt, no tax increases".

The pact now goes to a postal vote of all 475,000 SPD members -- many of whom have painful memories of the 2005-09 "grand coalition", which saw their party lose votes to the CDU.

The result of the postal vote should be known on December 14, allowing Ms Merkel to be sworn in as chancellor before Christmas -- or alternatively hold fresh elections in the new year if the proposal is rejected.

Thus, despite winning 19pc less seats than the combined conservative parties, the SPD's rank-and-file members now hold Ms Merkel's immediate political future in their hands.

Significantly, at the lunchtime press conference to unveil the deal, Ms Merkel -- who was looking tired after the all-night session -- spoke for only six minutes, while Sigmar Gabriel, the SPD's party chairman, was given 20 minutes to sell the pact to his party members.

Ms Merkel told reporters that the German voters did not see a fresh grand coalition as "all that repellent".

The main outlines of the deal see a national minimum wage rolled out between 2015 and 2017, a reduction in the pension age to 63 for those who have already worked 45 years, better pensions for mothers, relaxation of dual citizenship rules for Germany's large Turkish minority population, and a 30pc quota for women on listed companies' supervisory boards.

In return, Ms Merkel batted away SPD demands made during the campaign for higher taxation rates. (© Daily Telegraph, London)

Irish Independent

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