The German chancellor described high inflation and energy costs as “explosive material” for society, and promised relief for citizens, but also a “long-term process” of dialogue with social partners, with the aim of containing prices.
A dramatic message to German society was broadcast on Sunday by Olaf Solz in the wake of unprecedented reports even of electricity and gas rationing in Germany in winter.
The German chancellor characterized as “explosive” for society high inflation and energy costs, and promised relief for citizens, but also a “long-term process” of dialogue with the social partners, with the aim of containing prices.
The coalition government has already started with a lot of economic relief, Mr Scholz stressed, in his first summer interview as chancellor on German public broadcaster ARD, and repeatedly referred to the 30 billion euro aid package that boosted welfare benefits. and a single monthly ticket of 9 euros was introduced for all MMMs. “A lot is being done,” the chancellor asserted and clarified that some measures were implemented on July 1 and the citizen has not yet felt their impact. “For this year, we have absorbed almost 90% of the price increases for the lower and middle income earners,” he said, but admitted that “next year will be the biggest challenge.”
Olaf Solz also denied the information that had circulated recently about a tax-free lump sum payment assistance to employers. “There is no such proposal (…) and no one is suggesting that there will be no real increases for workers”, the chancellor stressed and spoke of a “total Sunday newspaper invention”.
Referring specifically to the natural gas supply company Uniper, which requested state support a few days ago, the chancellor favored the prospect of supporting utility companies. “Government loans to these companies are already contributing to the containment of prices,” said Mr. Solz and recalled that Lufthansa, due to the crisis of the coronavirus pandemic, needed state financial assistance of 9 billion euros. “We are currently in negotiations on what is preferable to ensure that the natural gas supply is not affected because a major company will not be able to continue its activity,” he said of Uniper.
In the same context, Mr. Soltz defended his government’s decision to negotiate the supply of liquefied petroleum natural gas from Qatar. “If we want diverse sources of energy, we also need many suppliers,” the chancellor said, responding to criticism of the Gulf state’s human rights record.
On the war in Ukraine, the chancellor again pledged to provide security guarantees after the end of the war, but clarified that this action would be under NATO’s guarantee and that talks are currently underway between the Alliance and Kiev on issue”.
Responding to a question about the content of his phone conversations with the Russian president Vladimir Putin, Olaf Solz said: “I always tell him: Remember, the – admittedly not very severe – sanctions that we imposed after the annexation of Crimea are still in place. The same is true of the sanctions for the instigated rebellion in eastern Donbass. And the sanctions we have imposed now will remain. The idea of ​​a dictated peace is absurd. You need to focus on reaching a fair deal with Ukraine.”
Asked about the criticism he receives due to his communication strategy, Olaf Solz characteristically stated that he does not belong to “the politicians who make an announcement a week, of which 90% say nothing”. That to me is right, he noted and added that “especially in a federal state, it is important to make announcements only when there is something important.” He also dismissed recent criticism of arrogance for his stance during a press conference. “I don’t think so, so I don’t share that assessment,” he said, when asked to give some practical advice on saving energy to German households, as the Finance Minister recently did Robert Habeck, he pointedly noted that “it is not enough to find the words, but it is up to the government to do what is necessary to ensure energy supply”. The “long-term process”, which starts tomorrow, involves talks between the government and employers, unions, experts and agencies, with the aim of dealing with the loss of purchasing power of citizens, but also the burden of the operating costs of businesses. “I want to limit the expectations for an agreement announcement already tomorrow,” the chancellor underlined at the same time. However, in view of tomorrow’s (Monday) talks, the president of the German Confederation of Trade Unions, Yasmin Fahimi, requested that a ceiling be imposed on the price of oil and natural gas.
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