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KEY POINTS: Germany’s next government unveils coalition pact

From ambitious climate targets to reforming trans rights - here's everything you need to know about what Germany's next government wants to do while they're in power.

Traffic light coalition parties
Representatives of the three coalition parties that will form Germany's new government arrive at a press conference to reveal their coalition pact on November 24th, 2021. Photo: picture alliance/dpa | Kay Nietfeld

Hundreds of reporters crammed into Berlin’s Westhafen on Wednesday to find out what Germany’s next government has in store for the country over the coming years.

The coalition pact, which was thrashed out behind closed doors at a record-breaking pace, will determine Germany’s path over the coalition government’s four-year term in power.

It contains flagship policies from all three of the parties: a hiked minimum wage for the Social Democrats (SPD), a much earlier transition away from coal for the Greens, and steering clear of tax rises for the pro-business FDP.

But it also contains policies that all parties were in favour of, such as permitting dual nationality and legalising the recreational use of cannabis.

Describing the result of the negotiations to reporters gathered at the press conference, soon-to-be Chancellor Olaf Scholz said Germany’s next government would be a “coalition of equals” in which every party played to its strengths. 

READ ALSO: LATEST: Germany’s next government sets out roadmap for post-Merkel era

Here are the key policies you need to know as Germany enters the post-Merkel era. 

Carbon neutrality by 2045 

As you might expect for a coalition involving the Greens, the climate crisis has taken centre stage in the 177-page pact set out by the three ‘traffic light’ coalition parties. 

In their agreement, the parties have pledged to phase out coal by 2030, eight years earlier than the target set by the previous conservative-led government. 

The Social Democrats, Greens and liberal FDP are aiming to “bring forward the coal phase-out to 2030 ideally and leave combustion engine technology behind”, the document said, adding they would also seek carbon neutrality by 2045.

A wind farm in Schleswig-Holstein.
A wind farm in Schleswig-Holstein. The traffic light coalition wants to source 80 percent of Germany’s energy from renewable sources by 2030. Photo: picture alliance/dpa | Christian Charisius

In a nod to the innovation-focused politics of the FDP, the parties also want to use 3.5 percent of GDP for investments in research and development that will speed up the transition to a carbon-neutral economy.

By 2030, 80 percent of Germany’s electricity should come from renewable sources such as wind and solar, the coalition revealed. That’s a significant jump up from the previous target of 65 percent.

“All suitable roof surfaces will in future be used for solar energy. For new commercial properties that will be compulsory, while for private new buildings, that will become the rule,” the parties said.

With an eye on Germany’s powerful automotive industry, the parties agreed that electric cars should number 15 million by 2030 from roughly one million currently, as combustion engine vehicles will no longer receive approval from 2035.

Caps on borrowing, no tax rises

Throughout the coalition negotiations, there was speculation that the Greens’ co-leader Robert Habeck and FDP leader Christian Lindner had each set their sights on taking control of the coveted Ministry of Finance.

Looking at the outcome of the talks on Wednesday, it’s clear who won the struggle: the FDP will be heading up the ministry, with Lindner taking on Olaf Scholz’s former job as Finance Minister. Accordingly, the coalitions’ fiscal plans have the FDP’s fingerprints all over them.

To start with, the parties have pledged to reinstate the country’s so-called debt brake, which limits the amount the state can borrow, by 2023. It was put on hold to allow for crucial public spending during the Covid crisis. 

Maintaining the debt brake was a red line for the FDP, and Social Democrat Finance Minister Olaf Scholz – who will be Germany’s next chancellor – has also long been an advocate of the rule.

The parties also agreed to not raise taxes during their mandate, according to a tweet by FDP leader Christian Lindner – a win for his party which has refused to raise any fiscal pressure on taxpayers.

Abortion and trans rights

As you might expect for a liberal-leaning coalition, the traffic light has pledged to expand some civil liberties with proposals to ease strict rules on abortion and gender transitions.

In a key move for women and healthcare professionals, the parties have pledged to abolish paragraph 219a, a controversial piece of Nazi-era legislation that makes it illegal to advertise abortion services.

“Doctors should be able to provide public information about abortions without fear of prosecution,” they say in the document.

Trans Pride in Germany
Numerous protestors gather at a demo in favour of trans rights in Oldenburg, Lower Saxony. Photo: picture alliance/dpa | Mohssen Assanimoghaddam

In addition, the SPD, the Greens and the FDP plan to replace the controversial Transsexuals Act “with a self-determination law”. This would include “a procedure at the registry office that makes changes to gender possible in principle by means of self-disclosure”.

In other words, it could soon become much easier for people to change their officially recorded gender. 

Legalising recreational cannabis 

Going one step further than the 2017 legislation that allowed cannabis for medical use, Germany’s new government wants to legalise the recreational use of cannabis. 

“We will introduce the controlled distribution of cannabis to adults for consumption purposes in licensed stores,” the parties say in the document. “This will control the quality, prevent the circulation of contaminated substances and ensure the protection of minors.”

READ ALSO: How Germany’s next government is planning to legalise cannabis

The Greens and FDP have long been pushing to legalise cannabis, while the SPD has proposed testing regulated distribution of the drug in pilot projects. Under plans leaked last week, the government will conduct a review four years after legalisation cannabis to see what the impact of the policy has been. 

Permitting dual citizenship 

As The Local reported on Wednesday, it appears that the three coalition parties have stuck to their promise to eliminate key hurdles to gaining German citizenship.

According to the coalition pact, immigrants will soon be entitled to apply for German citizenship after five years – or three if they can demonstrate high levels of integration. At present, most immigrants must wait between six to eight years before they are able to apply for citizenship. 

Dual Turkish and German nationality
A Turkish and a German passport are held side by side. For a long time, Germany has forbidden dual nationality for non-EU citizens. Photo: picture alliance / Carsten Rehder/dpa | Carsten Rehder

In a key move for non-EU citizens, the parties revealed in the coalition pact that they would change the law to allow the holding of ‘multiple citizenships’, suggesting that dual nationality will be permitted during the next legislative period. 

Currently, non-EU citizens who did not grow up in Germany must generally choose between German and foreign citizenship.

READ ALSO: Germany’s coalition government to allow dual nationality

Social security and wages 

The SPD will be taking over the Ministry for Labour and Social Affairs – and it’s clear to see the influence of the centre-left party in the policies that have emerged around benefits and wages.

From next year, the traffic light coalition say they will bump up the minimum wage from €9.60 to €12 an hour. This was one of the SPD’s flagship policies at the last general election.

In addition, the much-maligned Hartz IV unemployment benefit will be scrapped in favour of a more user-friendly Bürgergeld (Citizens’ Fund). People without jobs will be able to sign up for this type of financial support quickly and digitally, and the parties have pledged that people won’t be asked to justify the size of their flats or dig into their savings for the first two years of claiming it.

Another Greens and SPD policy is the introduction of Basic Child Insurance, which will condense the piecemealed forms of social support into one lump sum that should cover children’s basic needs until the age of 18. 

Tackling the housing crisis

Under plans to combat the country’s ever-worsening housing crisis, the new government will build 400,000 new flats each year, 100,000 of which will be publicly-funded social housing for people in lower income groups. They say this plan will help both renters and the construction industry. 

The parties also plan to tighten the so-called ‘rent brake’, a federal law aimed at limiting the amount a landlord can increase the rent on a property. 

Construction site in Mainz
A block of flats is built in Mainz. The new government plans to build 400,000 new homes a year. Photo: picture alliance/dpa | Sebastian Gollnow

While the current law restricts rent rises to 15 percent over a three year period, the government’s new plan will be to restrict rises on rent to 11 percent in tighter housing markets, such as those in many of the country’s larger cities. 

Although further details of the proposal have yet to emerge, the 11 percent cap is closer to that put in place in the capital of Berlin in 2020, which was later overturned by the federal court. 

READ ALSO: REVEALED: How Germany’s new government wants to tackle the housing crisis

Lowering the voting age 

In a sweeping change to Germany’s electoral law, the parties have greed to lower the voting age from 18 to 16.

The plans are likely to favour the Greens and FDP which are the two most popular parties among young voters, and that could cause problems for Angela Merkel’s conservatives, who are largely backed by Germany’s army of pensioners – though many older voters switched to Scholz’s SDP at the last election.

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CLIMATE CRISIS

INTERVIEW: ‘Failed climate policies are fuelling far-right politics in Germany’

Alt-right political parties tend to oppose environmental protections, but is there a connection between their political success and climate policy failures? Author and thought-leader Sandrine Dixson-Declève explains why Germany may be having a ‘1930s moment’, and why the next elections are gravely important.

INTERVIEW: 'Failed climate policies are fuelling far-right politics in Germany'

It’s understood that far-right and populist political parties tend to either downplay the realities of climate change, or block progressive policies that would try to mitigate its impacts. But the link between failed climate policies and the recent rise of populist parties is rarely addressed.

Speaking as a panellist at the Green Tech Festival in Berlin on Thursday, climate policy thought-leader Sandrine Dixson-Declève voiced concern that poor climate and economic policies are fuelling the popularity of far-right politics in Germany and across Europe. 

Co-president of the Club of Rome, Dixson-Declève works to promote policies that she believes would help secure a sustainable future for humanity. Such policies are laid out in the book Earth for All: A Survival Guide for Humanity, that she co-authored.

The Local spoke with Sandrine Dixson-Declève about Germany’s climate policy failures, and why she thinks the upcoming European elections are of the utmost importance.

The shortcomings of Germany’s ‘Energiewende’ had serious political consequences

Having been a contributor and advisor to Germany’s Energiewende (energy transition), Dixson-Declève has followed German politics and environmental policy for years.

“I believe that one of the biggest mistakes was that we politicised energy policy in Germany from the outset,” she told The Local, adding, “Merkel actually accepted the big green push to pull out of nuclear, which actually created a big mess.”

Germany’s anti-nuclear energy movement dates back to the 19070s, and led to the foundation of the Green party. Under Merkel’s leadership, a plan was adopted to phase out nuclear power with the last three nuclear power plants taken offline in 2023.

But losing nuclear power as an energy source came with some serious consequences.

“The first big mess was the continued burning of coal,” Dixson-Declève explained. “The second big mess was Nord Stream 2, and that led to the invasion of Ukraine…because it gave Putin power.”

Still, she wouldn’t suggest that Germany try to revive its nuclear power now: “I believe that Germany needs to really think through the next steps.”

READ ALSO: ‘Nuclear power is a dead horse in Germany’: Scholz rejects reopening plants 

Protestors run past riot police

A wave of protestors break through police lines at Lützerath. Open pit coal mining in west Germany destroyed most of the Hambach Forest, as well as dozens of villages such as Lützerath. At both sites massive citizen protests were met with brutal police evictions. Photo by Paul Krantz.

Energy efficiency is the missing piece to Germany’s climate plans

How to build up renewable energy infrastructure is at the centre of most discourse around curbing fossil fuel use, but using the energy we have more efficiently arguably deserves more immediate attention.

“The other missing link, which no one talks about, is energy efficiency,” Dixson-Declève said. “Actually the best energy is the energy you don’t use. That is unsexy, and that is why energy efficiency hasn’t been taken up the way it should have been since 2010.”

While working on climate and energy plans in 2010, she says she came across a study that said Europe could wean itself off of Russian gas just by putting energy efficiency requirements in place for buildings.

In 2022 the European Commission finally began to take this idea seriously when Germany and Europe suddenly needed to replace Russian gas imports, following Russia’s invasion of Ukraine.

Another massive energy saver that has been politicised for all the wrong reasons in Germany is heat pumps.

According to Eurostat data, about half of all energy consumed in the EU is used for heating and cooling, and most of that energy comes from fossil fuels. Heat pumps are significantly more efficient than boilers and allow for greater use of renewable energy sources.

But when Economy Minister Robert Habeck led an effort to promote heat pumps by banning new fossil-powered heating systems, conservative and far-right parties jumped on the issue as if it were an attack on personal freedoms. 

“As environmentalists, we need to get better at translating the environmental narrative into something that resonates with people,” said Dixson-Declève. 

READ ALSO: Reader question – How do I install a heat pump in my German property?

A unified coalition government that is serious about climate protections might have better communicated to people that heat pumps would ultimately save them money: “They should have been enabled in a way that truly assisted people in getting the heat that they needed in an affordable way at the right time.”

‘I am very scared we are in a 1930s moment’

Whereas the coalition government has largely failed to communicate to voters how environmental policies will improve their lives and save them money, conservative and far-right parties have done extremely well at hijacking the narrative. 

The European People’s Party (EPP – the EU’s largest conservative party), for example, is particularly adept at using citizens’ economic concerns to block environmental policies.

Having analysed the EPP’s manifestos, Dixson-Declève notes that they acknowledge the need to mitigate climate change, but say that protections cannot cost. 

“I think the EPP has done a very good job both of putting in fear of the greens, [as if] they’re only going to think about green climate policies and not about social policies [whereas] we’re here to think about you.”

Sandrine Dixson-Declève with Earth for All

Sandrine Dixson-Declève holds up a copy of the book ‘Earth for All’ alongside two of the book’s co-authors. Photo: picture alliance/dpa | Wolfgang Kumm

Germany’s far-right parties tend to use similar messaging to try and convince voters that they will better improve the lives of citizens than the current coalition parties have. 

READ ALSO: Why are the far-right AfD doing so well in German polls?

Nearly 100 years ago, the National Socialist (Nazi) party succeeded in drumming up major support along similar lines.

Speaking as a panellist at Berlin’s Green Tech Festival, when asked how she thought European politicians were doing on climate issues, Dixson-Declève described them as deer in the headlights, adding, “I am very scared we are in a 1930s moment”.

“I think that in the 1930s we didn’t see Hitler coming, we didn’t read the tea leaves,” she told The Local, adding that in the present moment, “people are suffering. When people suffer, they look to anything, any message that’s going to make them feel like that next leader is going to help them.” 

She also suggests that we can’t count on the youth vote to save us, citing Argentina and Portugal as two places where young voters have actually pushed politics to the right recently.

READ ALSO: A fight for the youth vote: Are German politicians social media savvy enough?

“This is a tipping moment politically, and if we’re not careful, it could explode in our faces,” said Dixson-Declève. “We need to get as many people to vote this year [as possible]. It’s an absolutely fundamental vote, alongside the United States, in order to make sure that we don’t slide to the right across Europe.”

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