Vice-Chancellor Lars Klingbeil outlined a reform agenda for the coalition at the Bertelsmann Foundation. He demanded courage from his SPD, as 2026 would require boldness. This comes ahead of negotiations on a major package of measures.
In Berlin, the coalition's reform plans from CDU and SPD are taking shape following the first state elections of the year. Chancellor Friedrich Merz stated in the Bundestag that reforms are necessary to keep Germany a prosperous economy. “Most of the problems are home-made by us,” Merz emphasized. “And therefore it is up to us to ensure these problems get smaller again.” The coalition plans negotiations on a package of measures in the coming weeks. Ideas already circulating include scrapping free co-insurance for spouses in statutory health insurance, as reported by Handelsblatt. A VAT increase is also under discussion to cut social contributions and make overtime more attractive, according to Handelsblatt on Tuesday. Merz did not rule out a VAT hike in the Bundestag but mentioned the option of lowering the reduced rate on food. Finance Minister Klingbeil outlined detailed proposals for the package in a keynote speech at the Bertelsmann Foundation. This serves as a negotiating offer to the Union and a message to the SPD. “2026 will demand courage from us,” Klingbeil said. Among the positions could be controversial labor market measures.
