In view of the sharp rise in energy prices, Federal President Frank-Walter Steinmeier is calling for further relief for citizens. You have to think about “how to make life easier for low earners in particular,” said the Federal President in the ZDF summer interview.
Not everyone benefits equally from the relief packages that have been decided so far. The federal government must ensure that “those who are at the bottom end of the social scale and urgently need help are not lost sight of,” warned Steinmeier. They need help to pay for their apartment and their heating bills.
Chancellor Olaf Scholz (SPD) emphasized that the relief packages already approved by the federal government would absorb around 90 percent of the price increases for lower and middle incomes this year. “Next year will be the biggest challenge,” said the chancellor in the ARD summer interview.
Brandenburg’s Prime Minister Dietmar Woidke (SPD) spoke in the “Handelsblatt” for a further relief package. While the SPD and the Greens are calling for additional relief in the near future, Federal Finance Minister Christian Lindner (FDP) has said that another package to mitigate the increased prices should not be available until next year. There is no room for this in the current budget.
Before a meeting with employers and unions this Monday, Scholz denied that the tax-free one-time payment from employers he had discussed was intended to avoid wage increases. “No one is suggesting that that’s why the actual wage increases shouldn’t happen,” he said in the ARD interview. It is about finding solutions together to make the price increases manageable.
This Monday, representatives of employers and trade unionists as well as scientists will come together with the federal government in a “concerted action” in Berlin to discuss the consequences of inflation. Scholz had invited to this dialogue. “We have to link arms and stick together,” he said.
Federal Family Minister Lisa Paus (Greens) expects that she may have to make adjustments to family benefits. In the Tagesspiegel interview, she referred to the immediate child allowance and the one-off payments for affected families contained in the relief packages. “But of course it’s possible that we’ll find out in the fall that that’s not enough.” In view of the high inflation, an adjustment to the child benefit will certainly be necessary.
According to a new study by the German Economic Institute (IW) in Cologne, households are spending an ever-increasing part of their income on energy. Accordingly, in May almost 25 percent of all households in Germany were more than ten percent of their net income. In 2021 it was only 14.5 percent of households. In the meantime, the high prices are no longer just a burden on lower-income households, but also on the lower middle class.
The institute, which is close to employers, recommends targeted help for households that are just above the basic security limit. In addition, households that receive housing benefit and will soon receive a one-time heating subsidy should receive more support – for example along the lines of the flat-rate heating cost allowance that was paid after 2009. In this way, low-income households could be supported “specifically and permanently”, said IW economist Ralph Henger.