The German economy is facing increasing headwinds, prompting Economics Minister Katarina Reiche (CDU) to advocate for sweeping reforms that extend far beyond the current “black-red” coalition agreement between the CDU and SPD. In an interview with T-Online, Reiche declared the necessity of “putting Germany back on track” signaling a potential rift within the governing alliance regarding the scope and intensity of economic adjustments.
Reiche’s core argument centers on the need for a significant increase in overall working hours across the nation. This ambition, she stated, necessitates a fundamental re-evaluation of the existing retirement system, with a particular focus on extending working lives and, by implication, raising the retirement age. While acknowledging the coalition agreement as a foundational document, Reiche sharply criticized the SPD’s adherence to it, labeling their stance as a “ceiling” that needs to be jointly lifted.
The proposals are likely to be met with considerable resistance. Reiche indicated willingness to explore measures to incentivize full-time employment, suggesting tax breaks or expanded childcare options to disincentivize part-time work. This strategy, she contends, will boost productivity and address labor shortages.
Beyond retirement reform, Reiche also called for a loosening of labor laws, specifically advocating for a more flexible system of employee protection. She argued that while vulnerable workers must remain shielded, companies – especially those in high-wage sectors – need the ability to rapidly adjust staff levels in response to changing market conditions. This position is likely to draw criticism from labor unions concerned about job security and potential exploitation.
Reiche expressed strong expectations for the newly established pension commission, demanding a “merciless analysis” of the current situation and bold solutions. The commission is being tasked with identifying further possibilities to encourage continued employment beyond the standard retirement age and to critically address the issue of early retirement. Reiche specifically targeted the practice of companies encouraging experienced, qualified employees into early retirement, while simultaneously lamenting a lack of skilled workers, describing it as unsustainable and requiring compromise from all stakeholders. Experts suggest the Minister’s proposals represent an increasingly assertive agenda aimed at fundamentally reshaping the German economic landscape, potentially exacerbating existing political tensions within the coalition.
