background
The traffic light coalition continues to do poorly in the polls. With a view to European and state elections, the SPD, Greens and FDP have a difficult year ahead of them. What issues do they need to resolve now? An overview.
The current surveys give the traffic light parties little reason for confidence for the 2024 election year. After the partial repeat election in Berlin on February 11th, the first important date is the European elections at the beginning of June. This will be followed by state elections in Saxony and Thuringia on September 1st and in Brandenburg on September 22nd.
The traffic light coalition had already decided several times to argue less publicly – most recently after the so-called summer break. She was only partially successful. The most recent example: Soon after the budget compromise was announced, the agreement was called into question again.
According to experts, this behavior damages the federal government’s reputation and could be one of the reasons for the poor approval ratings in surveys. What are the coalition’s most urgent tasks this year? An overview.
Household
With the ruling of the Federal Constitutional Court, the traffic light coalition surprisingly lost a large part of its budget planning. After long discussions, the coalition partners agreed on how the gap of 17 billion euros in the 2024 budget should be closed.
The removal of agricultural diesel subsidies, which farmers are protesting against and which has now been partially withdrawn, has been particularly controversial recently.
The final details of the draft budget for 2024 are to be determined this month and discussed in the Bundestag. The Federal Council is expected to deal with this on February 2, 2024. Until then, a provisional budget management will apply, which will give Finance Minister Christian Lindner more opportunities to influence. The questioning of the debt brake in the wake of the floods shows that the type of budget management in the traffic light coalition as a whole has not yet been fully discussed.
Business
The German economy is in an economic downturn. Institutes and the federal government expect a decline in economic output for 2023 as a whole. Leading research institutes recently significantly lowered their forecasts for the coming year. Only mini-growth is expected.
The term “Europe’s sick man,” which the British magazine “Economist” used to describe Germany at the turn of the millennium, has been making the rounds again in recent months.
The federal government has announced an “offensive” for more economic growth. At the heart of this is the “Growth Opportunities Act”. Specifically, the economy is to be given tax relief – including through bonuses for investments in climate protection and better depreciation conditions. However, the law has not yet been passed. It is currently hanging in the mediation committee between the Bundestag and the Bundesrat.
climate
How Germany wants to make progress in climate protection is actually clearly regulated: The Climate Protection Act stipulates that climate-damaging emissions should be reduced by 65 percent by 2030 compared to 1990. Emissions are expected to fall by 88 percent by 2040 and net greenhouse gas neutrality should be achieved by 2045.
Successes in reducing emissions are shown by recently published figures from the think tank Agora Energiewende. However, it remains unclear how sustainable the reduction in emissions is. According to the study, one of the main reasons for the decline in emissions is the current poor economic situation.
In addition, two areas of climate protection are lagging behind: the previously legally stipulated sector targets for transport and buildings are still not being achieved. The reform of the Climate Protection Act provides for the individual sectors to be given more leeway as long as the overall goal is achieved. However, this law has not yet been passed by the Bundestag.
housing
In view of the housing shortage in the cities and rising rents, the federal government wanted to stimulate housing construction. There was talk of 400,000 apartments per year. Building Minister Klara Geywitz has long been aware that this goal cannot be met. But the trend is even continuing downwards.
The Munich Ifo Institute estimates that only 225,000 apartments could be completed in 2024 – 45,000 fewer than last year. The most important industry associations, the Main Association of the German Construction Industry and the Central Association of the German Construction Industry, are also pessimistic, even if their respective forecasts differ somewhat.
The reasons include: Both the actual construction costs and the loan interest rates have increased significantly since 2020. In addition, there has been the back and forth over the past few years regarding the federal funding programs and the current budget cuts. Construction companies and experts also repeatedly mention excessive bureaucracy and the constant tightening of building regulations.
The problem is noticeable: Many people are desperately looking for housing, especially in cities. Although property prices fell last year, rents continued to rise in many places.
Traffic
The future of one of the traffic light coalition’s success stories is in jeopardy: the price of the Germany ticket could be raised if the financing is not clarified. Last year, the federal states committed to continuing the offer. However, they are demanding a signal from the federal government that the ticket will continue to be jointly financed. So far there has been no commitment to this.
In November, the federal and state governments decided on a comprehensive package to speed up planning and approvals. The package includes around 100 individual regulations, including for motorways and train routes, which are intended to be built more quickly. Environmental associations had previously sharply criticized the federal-state plans. They fear that it could be at the expense of nature if regulations for environmental impact assessments and species protection are changed.
Basic child protection
The traffic light coalition has struggled for a long time about basic child security, and this was primarily about money issues. The plan is to introduce it in 2025, then there will be 2.4 billion euros for it. The financing is therefore not dependent on the current budget planning, as Family Minister Lisa Paus emphasized in December.
Originally, basic child welfare was supposed to be implemented on January 1, 2025, but after concerns from the Federal Employment Agency, Minister Paus admitted that it could also be April 1, 2025. The changeover involves considerable administrative effort.
migration
At the beginning of November, Chancellor Olaf Scholz agreed with the heads of government of the federal states that the federal government will examine whether asylum procedures are possible outside Europe. One model envisages that asylum seekers who have already arrived are flown out again. You would then have to wait in a third country for the result of the procedure. But critics doubt whether this is compatible with, among other things, the Geneva Refugee Convention.
In October, the state prime ministers also declared the goal of completing asylum procedures and often subsequent legal proceedings within three months. To this end, they called on the federal government to conclude further migration agreements and readmission agreements with individual states and to equip the Federal Office for Migration and Refugees (BAMF) with appropriate staff.
Georgia and the Republic of Moldova were classified as safe countries of origin in December. However, the Greens have so far ruled out the possibility that other countries such as Algeria will also be classified this way. Federal Interior Minister Nancy Faeser signed a migration agreement with Georgia in December that stipulates that Georgians can be deported more easily – but also have better access to the German labor market. The Federal Government’s Special Representative for Migration Agreements, Joachim Stamp, is also working with other countries on such agreements.