Germany: What you should know about the coalition deal

After protracted talks, Chancellor Angela Merkel’s conservative CDU/CSU bloc reached a deal for a new coalition government with the centre-left Social Democrats on Wednesday. If approved by the SPD’s 460,000 members, the deal would end Germany’s longest period without a government since the Second World War.

Here are the key points agreed in the draft coalition contract:

Health insurance

The three parties have agreed to set up a commission tasked with producing proposals for a reform of doctor fees for public and private treatment. This is something of a compromise for the SPD, which had been pushing for “citizens’ insurance,” which would have ensured a basic standard of treatment for everyone, regardless of whether they were publicly or privately insured.

Chancellor Merkel praised the deal as providing a “good foundation for a stable government” and would bring a “new dynamism to Germany” / Photo: Screenshot


Labour market

The SPD won one of its key points by ensuring that labour contracts can only be time-limited if the employer gives a specific reason. There will also be a specific program aimed at getting 150,000 long-term unemployed back into work, and a right to switch back from part-time back to full-time employment.


One of the most contentious issues was dealt with fairly early in negotiations: The two sides agreed last week that the number of immigrants brought to Germany via family reunification would be capped at 1,000 a month (for those with subsidiary protection) — the same figure that was set out at the end of exploratory talks a few weeks ago — and that the current suspension on reunions would end on July 31. Cases of “extreme hardship” would also be allowed to apply for family reunion, beyond the quota.

Refugee rights organizations such as Pro Asyl argued that this was a cosmetic difference anyway, as the exception has already been in place for the past two years and was only invoked in about 100 cases last year. Hundreds protested outside the Reichstag in Berlin last week as the measure was passed in parliament.


The three parties have agreed that the European Union needs “more investment,” specifically in the shape of an investment budget for the eurozone. That deal was celebrated by the SPD as “an end to the austerity mandate” across the European Union, but it remains to be seen how the details pan out. The parties also promised a special focus on reducing unemployment among young people and “fair taxation of companies — especially the internet giants Google, Apple, Facebook and Amazon in Europe.”

Martin Schulz, the SPD leader and foreign minister-designate, said the new grand coalition would signify a “fundamental change of direction in Europe” / Photo: Screenshot



The SPD claimed a victory in combating an urgent problem in many of Germany’s urban centres: unbridled property speculation, which has led to rising rents, a shortage in affordable housing and increasing homelessness.

In fact, that gain mainly amounts to a slightly tougher rent cap, which would force landlords to disclose the previous tenants’ rents. Tenant-rights organizations have already said the idea doesn’t go nearly far enough. “That’s as good as nothing at all,” Reiner Wild, head of the Berlin renters’ association, said of the modification — what was needed, he added, was the threat of real punishment for landlords who violate the cap.


Apart from an €11 billion package meant to boost Germany’s investment system, the two sides have agreed to lift a so-called cooperation ban, which stops the federal government from investing in schools — something that is supposed to be an exclusive purview of the states.


The CDU and SPD negotiators agreed that Germany would stick to the international climate goals in 2030 and 2050. A special commission would be tasked with coming up with an “action plan” by 2018 on how to hit those targets, with each department — transport, agriculture, etc. — obliged to set its own goals. But this, climate activists argued, was the least the parties could do. Environment Minister Barbara Hendricks, of the SPD, has already admitted that Germany will almost certainly miss its own emissions reduction target for 2020: a 40 percent reduction on 1990 levels. The Greens have described the new coalition deal a “sabotage” of Germany’s climate goals.


Here, the two parties agreed to a “billion-euro program” to extend Germany’s broadband reach to close gaps in a country where many rural areas do not have adequate online access. There will, the working group promised, be “a right to a fast internet by 2025” — in other words, a law guaranteeing all Germans broadband internet connection. The plan has been criticized by Bitkom, the IT sector industry association, which said the obligation would only hold back internet providers.

© DW

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