Germany: Huge, ‘precise and targeted’ relief package promised by Scholz

With a huge, “precise and targeted” relief package, the federal government intends to support citizens and businesses in the face of high energy prices, Chancellor Olaf Solz (SPD) said after two days of cabinet deliberations at Brandenburg’s Meseberg Castle.

Mr. Soltz avoided giving details or a specific timetable for the announcement of the relief measures, even saying he was “professionally proud” of the fact that so far there have been no leaks about the contents of the package. Regarding energy security, the chancellor assured that the government will do everything in order for there to be “a good development in this difficult period” and estimated that prices will not eventually exceed the limit.

Economy Minister Robert Hambeck (Greens), for his part, stated that measures to limit natural gas consumption would also be needed and emphasized the need not only to mitigate the consequences of high prices, but also to eliminate the causes of the accuracy. “Germany is well prepared for the winter. The gas tanks are almost full. This gas is not being withdrawn from the market, but will be available in the winter,” he explained, announcing that the “special gas fee” of 2.419 cents/kWh it will be revised so that only energy providers who really need it benefit from it. From now on, companies will have to meet many criteria to be entitled to it, said the minister, who had been widely criticized in recent days, when it was found that the fee aimed at stabilizing the energy market would also bring benefits to companies which even recently had billions of euros in profits.

Finance Minister Christian Lindner (FDP) also announced the government would adjust electricity market regulations, a measure he estimated would cost the 2022 budget “single-digit billions”, thanks to higher-than-expected tax revenues. The cost, however, will increase in 2023, he explained. “I believe that we will soon see changes in this” and at the European level, noted the chancellor. “It’s not just Germany that is suffering. The reservations are now gone and everyone wants it,” he noted.

Regarding the tax on excess profits, Mr. Lindner again expressed reservations and pointed out that lawsuits have already been filed in other countries, such as Italy, while he appeared positive about the prospect of introducing a new ticket to succeed the single monthly 9 euro that applied for the last three months and expires today.

Apart from energy, Olaf Solz described the changing security situation in the world as “one of the most pressing issues” for his government. Russia’s attack on Ukraine is “an imperialist attempt to use force to move borders”, he stressed, adding that Germany must react to it with its own security strategy and international alliances. “A stronger Europe is also needed in response to an increasingly complex world,” he said.

The chancellor and his two ministers and government partners tried during the press conference to convince of their harmonious cooperation, which has recently been strongly questioned. “We work well together,” Mr Habeck said, even defending Mr Soltz against criticism from the Greens. “It is very good that this government is led by Olaf Solz,” he said, praising the chancellor’s composure, prudence and experience.” Earlier, the head of the Greens’ parliamentary group, Constantin von Notch, spoke of the chancellor’s “poor performance” , also referring to his possible involvement in the Cum-Ex tax scandal.

Source: RES-MPE