Finance Minister Lindner has announced that the energy price caps will end at the end of the year. But this is not a done deal, emphasize the SPD and the Greens. The SPD would like to continue the aid, the Greens can imagine an earlier end.
The early end to the energy price brakes at the end of the year announced by Finance Minister Christian Lindner (FDP) has provoked mixed reactions from government partners and accusations from the opposition. The coalition partners SPD and Greens made it clear that implementation of Lindner’s announcement by the traffic light coalition was by no means certain, but would be part of negotiations.
Despite the budget crisis, the vice-chairmen of the SPD parliamentary group, Matthias Miersch and Verena Hubertz, spoke out in favor of continuing the measures, whose extension until the end of March was only cleared by the Bundestag on November 16th. Lindner must “create legal certainty for 2024” regarding price caps for electricity and gas, explained Miersch and Hubertz. With the price brakes, “we are giving millions of households and companies security against excessive energy prices.” Against the background of the Karlsruhe budget ruling, which means that 60 billion euros less are available for climate investments, “the construction must now be made legally secure for the coming year”.
SPD General Secretary Kevin Kühnert told the “Kölnische Rundschau” that he “noticed Lindner’s announcement with astonishment.” “That may be his opinion – it is not a decision by the coalition.” Whether there will still be energy price brakes in 2024 must now be negotiated politically. “The SPD considers this to be necessary,” said Kühnert. Chancellor Olaf Scholz said at a state party conference in Schönefeld: “It was right to subsidize the high prices for citizens.” The government will continue to do everything it can to cushion the economic consequences of the war in Ukraine.
Greens emphasize ongoing discussions about Financing
The Green Party leader Omid Nouripour, who has just been re-elected, supported the end of the price cap. He explained that because of the Federal Constitutional Court’s ruling, the government parties are now busy trying to stop immediately, which could make solutions difficult later. This also includes the energy price brake. “This decision is painful, but one that belongs to it.” Precisely because the Economic Stabilization Fund (WSF) is now at massive risk, the support financed from it must be stopped.
At the same time, Nouripour’s Green Party co-leader Ricarda Lang made it clear that despite Lindner’s announcement about an end to the energy price caps, there was still no agreement from the government on this issue. It is currently only clear that the WSF will be dissolved, the debt brake will remain suspended and the energy price brakes will be paid by the end of the year, Lang told the broadcasters RTL and ntv at the party conference in Karlsruhe. How funding will continue from 2024 onwards “is of course still being discussed within the government”. Of course, the government has already talked about energy price caps, but at the moment many questions are still unanswered. “In the end you have to look at the overall package and then see how we get through not only this year, but also the next few years,” said Lang.
No more billions for financing
The price controls were introduced in March of this year and also applied retroactively to January and February. They should protect consumers from being overwhelmed by skyrocketing energy prices as a result of Russia’s attack on Ukraine.
Lindner announced on Friday that the government would not extend the billions in state aid through the electricity and gas price brakes until the end of March 2024 as planned. They would be “finished at the end of the year,” he said Deutschlandfunk.
The price brakes were financed via the economic stabilization fund, which was endowed with up to 200 billion euros. The Karlsruhe judges had declared such special funds inadmissible alongside the regular budget. The WSF is no longer available, said Lindner.
Criticism from trade unions and the Union
The Union sees the halting of the relief measures as a necessary consequence of the Federal Constitutional Court’s ruling and clearly sees the government as responsible for the failure of the relief measures. “There was an agreement to violate the constitution in which we were caught by the traffic light through the ruling of the Federal Constitutional Court,” said the chief budget officer of the Union parliamentary group, Christian Haase (CDU). “This self-inflicted legal violation must now be remedied. The expiry of the energy price cap is unfortunately the unpleasant result of this judgment.” CSU boss Markus Söder made similar comments. He accused the government of lack of planning.
Criticism also comes from the unions: “Letting the price brakes expire before the winter will cause additional uncertainty,” criticized Yasmin Fahimi, the chairwoman of the German Federation of Trade Unions (DGB).
The Federal Association of Consumer Centers (VZBZ) criticized that the “current chaos surrounding the federal budget” should not be one-sidedly to the detriment of consumers. “Private households are facing significantly rising prices,” said VZBV boss Ramona Pop.