Chancellor Olaf Scholz (SPD) rejects his plan for a one-off payment in the fight against inflation from the unions. “One-off payments don’t get us anywhere,” said Verdi boss Frank Werneke on Monday in the “Radiowelt” program on Bayern 2. IG Metall and the police union (GdP) also rejected the idea.
Scholz is aiming for a tax-free one-off payment from employers to compensate for the increased energy costs. In return, the unions should forgo part of the wage increases in collective bargaining rounds. The “Bild am Sonntag” had reported on this, and the plans were confirmed to the German Press Agency. This is to curb inflation. On July 4, the government wants to start a dialogue initiated by Scholz with the social partners and the Bundesbank in the fight against price increases, the so-called concerted action.
The DGB boss Yasmin Fahimi reiterated her negative attitude to a one-off payment. “In the long term, only higher wages and targeted support for people without work can be useful instruments against higher living costs,” said Fahimi of the “Rheinische Post”.
Werneke said it was the job of the bargaining parties to ensure that permanently rising prices also resulted in permanently effective collective wage increases. “And I don’t see that politicians can do that for us either.”
A spokeswoman for IG Metall referred to statements made by union boss Jörg Hofmann at the beginning of the month. When announcing the concerted action, Hofmann explained: “Collective bargaining is not conducted in the Chancellery. It is not politics that decides on the goals of our collective bargaining policy, but rather the collective bargaining commissions and committees of IG Metall.”
Deputy government spokesman Wolfgang Büchner did not want to confirm or deny Scholz’s plans on Monday. He could not anticipate the concerted action. “Nobody has ever suggested collective bargaining in the Chancellery,” he emphasized. Incidentally, the agenda for the concerted action is to be announced this Friday.
The employer-related Institute of German Business considers a one-time payment to be “reasonable”. Such payments would immediately help pay higher bills, but reduced the risk of a wage-price spiral because companies’ costs would not increase permanently. Tax and duty exemption is a tried and tested means of incentivising companies.
“If 75 percent of the employees received an average of 500 euros, the state would forego tax revenue of an estimated five billion euros, and the revenue foregone from social security would also be around five billion euros,” the institute reports. Due to higher consumer spending, money would flow back to the state via energy and value added tax.
Werneke referred to their own wage negotiations, for example for the ports, Lufthansa or the public sector. The increased prices would need to be offset by a linear value, a percentage increase, he said. Base amounts are also a possibility. However, these are not one-off payments, but would be effective as a monthly payment.
Despite his negative attitude to one-off payments, Werneke announced that there was something to be discussed in the planned concerted action in the Chancellery: “We need a third relief package, which will take effect in the autumn.” Recipients of state benefits and pensioners should also be supported.
The police union (GdP) also doesn’t believe in one-off payments. “This is not sustainable help. Life will also become more expensive in the coming months,” said Deputy GdP Federal Chairman René Klemmer.
Left-wing member of the Bundestag Pascal Meiser accused Scholz of “brazenly interfering in free collective bargaining”. He should rather make sure that the federal government improves its obviously insufficient relief packages. Criticism of the proposal also came from the social association VdK. “Once again, poor pensioners are left behind,” said VdK President Verena Bentele to the newspapers of the Funke media group.