Merkel ready for 'second phase' of reforms

29th March 2006, Comments 0 comments

29 March 2006, BERLIN - German Chancellor Angela Merkel, buoyed by weekend victories in state elections, said Wednesday that her government was ready to press ahead with far-reaching reforms.

29 March 2006

BERLIN - German Chancellor Angela Merkel, buoyed by weekend victories in state elections, said Wednesday that her government was ready to press ahead with far-reaching reforms.

"What we have done so far is not enough," she said of her four-month-old coalition of centre-right Christian Democrats (CDU) and left-of-centre Social Democrats (SPD).

She told parliament that her grand coalition government was moving into "the second phase" during which restructuring, reform and investment would take priority in Europe's largest economy.

The chancellor was speaking on the second day of the annual budget debate, which is traditionally used by the opposition to criticise the government on a whole range of policy issues.

Merkel's administration has set out an ambitious programme of reforms, including a major overhaul of the ailing health service and changes to free up the labour market and cut non-wage costs.

Opposition Free Democrat spokesman Wolfgang Gerhardt accused the government of sticking to a "false and ineffective" policy that had not brought down the high unemployment rate of 12.2 per cent.

He said the coalition had not lived up to its pledge of giving priority to job creation and was sticking to policies closely associated with the previous SPD-led government of chancellor Gerhard Schroeder.

"You are taking too much and giving back too little in return," Gerhardt said in reference to the planned 3 per cent hike in consumption tax from January 2007.

Finance Minister Peer Steinbrueck presented the 261-billion-euros (313 billion dollars) budget to parliament on Tuesday, seeking approval for a rise in spending coupled with fresh borrowing in an effort to boost the economy.

Merkel said there was a need to reduce the national debt, "but we can't do everything at once." The 2006 budget, she said, was a result of a restructuring which still made growth possible.

In the foreign policy part of her speech, Merkel sought the support of deputies for German participation in a European Union mission to Congo to help safeguard elections on June 18.

It was not without risk, she said, but "we can't say, 'No, we won't do it,' when asked for help by the United Nations."

The UN has asked the EU to send a 1,500-strong contingent to the Democratic Republic of Congo because its own soldiers are overstretched. Germany has offered to lead the mission and supply 500 troops.

The cabinet is due to give its formal approval on May 3, but the deployment has to be debated in parliament where there is strong opposition to the move.

Coinciding with the debate was the release of a new opinion poll Thursday by Stern magazine and RTL television which showed support for Merkel's CDU-Christian Social Union (CSU) alliance dipping 3 per cent to 38 per cent.

Support for her coalition partner SPD was steady at 28 per cent, according to the survey of 2,500 people conducted by the research institute Forsa.

On Sunday, Merkel's party won elections in the states of Baden-Wuerttemberg and Saxony-Anhalt, while the Social Democrats held on to their regional power base in Rhineland-Palatinate.

DPA

Subject: German news

0 Comments To This Article