Four-year plan of Germany's ruling coalition

"The best comes last. This also applies to the Germany's red-green-yellow coalition agreement. At the end of the 177 pages there is the allocation of departments. From the economic point of view, the following ministries are relevant: In addition to the Chancellery, the SPD also has the Ministry of Labor and Social Affairs (presumably still with Hubertus Heil) and the houses for health, building and development. The Greens take care of the economy and climate protection (probably Robert Habeck), but also the environment and agriculture. The FDP is given responsibility for finances (Christian Lindner) as well as transport and research.

The penultimate chapter in the joint work program is entitled “Future investments and sustainable finances”. On the one hand, it contains a commitment to the debt rule in the Basic Law and, on the other hand, instructions on how this should be expanded.

A trick fills the climate fund

In 2022, the debt rule will be suspended again with reference to the consequences of the pandemic. "We will use the additional opportunities in particular to overcome the corona crisis and take measures for a quick economic recovery." This indicates that the additional financial leeway gained with reference to corona should also be used for other purposes, which is likely to be constitutionally sensitive. For the years from 2023 onwards, the coalition agreement promises to limit the debt to the scope provided by the constitution.

The economic policy model of the Ampel-Coalition is a “socio-ecological market economy”. The Ministry for Economic Affairs and Energy becomes an Economic and Climate Protection Ministry. The coal phase-out should "ideally" take place by 2030 instead of 2038 as previously planned. 

 

By 2030 there should be at least 15 million fully electric cars in Germany. 

 

The coalition agreement does not specify a specific end date for the approval of new cars with internal combustion engines; this is planned for 2035 at EU level.

 

In the research and production of hydrogen, battery cells for electric cars and in the development of the semiconductor industry, Germany is to become a leading location in the world. 

 

An “Alliance for Transformation” is planned together with business associations and trade unions. The state development bank KfW is to be expanded into an "innovation and investment agency". 

 

Business start-ups should be possible within 24 hours. 

 

A bureaucracy relief act - it would be the fourth - should make life easier for companies. Free trade agreements are to be geared more towards sustainability, and takeovers by foreign investors in sensitive areas are to be scrutinized more strictly.

Change in the pension calculation

In terms of pension policy, the new partners first reaffirm their promises from the exploration: "There will be no pension cuts and no increase in the statutory retirement age." They promise to maintain a minimum pension level of 48 percent over the long term. "During this legislative period, the contribution rate does not rise above 20 percent," it says. They also want to get a partial funding of the statutory pension insurance.

Then there is an important addition: "We will reactivate the so-called catch-up factor in the pension calculation in good time before the pension adjustments from 2022 and allow it to take effect within the framework of the applicable stop lines." That means: pensioners will continue to be protected against falling salaries if wages are in a crisis and salaries are falling, but increases due later are correspondingly lower. The grand coalition had deleted this regulation from the pension law.

In the health sector, the traffic light is committed to "stable and reliable financing of statutory health insurance". For this purpose, the federal subsidy, which outside of Corona amounts to 14.5 billion euros per year, must be “regularly dynamized”, i.e. increased. In order to save expenses, the health insurance companies should be given more opportunity to limit drug prices payed to pharmaceutical manufacturers. 

 

In order to encourage the insured to take up prevention programs, the health insurers will be able to offer monetary bonuses in the future. 

 

It was already known that the traffic light wanted to legalize the sale of cannabis to adults in licensed shops.

Continuation for the rental price brake

The Ampel-Coalition also wants to ensure that around 400,000 new apartments are built in Germany every year, 100,000 of which are social housing. The coalition agreement promises tenants a number of reliefs. 

The rent brake is to be extended until 2029. In tense housing markets, rents should only be allowed to rise by 11 percent within three years instead of 15 percent. In cities with more than 100,000 inhabitants, rent indexes are to be made mandatory. The CO2 price on heating costs should be shared “fairly” between landlords and tenants. The housing benefit is to be increased and expanded to include a climate component. In the short term, there should be a "one-time increased heating cost subsidy". The federal states are to be given the opportunity to introduce an exemption in the real estate transfer tax for owner-occupied residential property. 

 

From 2025 onwards, 65 percent of the newly installed heating systems must be powered by renewable energy. From 2024 onwards, stricter energy efficiency standards will apply to major renovations. Finally, the traffic light parties set themselves the goal that there should be no more homelessness by 2030.

 

In transport policy, the priorities are clearly distributed: Although car traffic is still being dealt with first, the emerging coalition believes that rail traffic in particular is worthy of development. “Much more” is to be invested there than in the road. 

 

The traffic light parties do not want to fundamentally change anything in the structure of Deutsche Bahn; at any rate, they are not considering a separation of network and operation, as many have called for. 

 

By 2030 there should be one million “public and non-discriminatory accessible charging points” for electric cars in Germany. Interesting for young people: accompanied driving should be possible from the age of 16.

 

In the future, agriculture should be “geared towards the goals of protecting the environment and resources,” it says. By 2030, 30 percent organic farming is the goal. So far, a little more than a tenth of the agricultural area in Germany has been farmed according to ecological criteria. 

 

Binding animal husbandry labeling is to be introduced from 2022 onwards. Fattening farms are evidently facing new rules: “The development of livestock should be based on the area.” The use of pesticides is to be significantly reduced, and the controversial herbicide glyphosate is to be withdrawn from the market at the end of 2023. For the EU agricultural subsidies, the coalition wants to develop a concept of how direct payments to farmers from 2027 "can be adequately replaced by remuneration for climate and environmental services".