German Chancellor Friedrich Merz is advocating for a sweeping reform program, warning that the country is in denial about security risks, technological changes, an aging population, and foreign competition. This reform program was presented in his speech to lawmakers.
According to Merz, the government will introduce further reform measures in the coming weeks and months. The cabinet will present proposals for significant reforms, after which parliament will decide the country’s future “together”. Merz emphasized that the responsibility for Germany’s future lies with all members of parliament.
Key Areas of Reform
Merz’s government is proposing a package of reforms aimed at reducing the cost of operating systems in Germany, stimulating growth, and adapting to an aging population, military threats, and economic competition. The main areas of these reforms have already been announced and discussed.
In the area of healthcare, the government plans to increase spending in the state health insurance system, which may lead to a reduction in some services. Regarding pensions, the system is set to be adjusted to cope with an aging population, meaning people will work longer. In defense, Germany plans to increase military spending and enhance combat readiness.
In the labor market, the goal is to stimulate employment, address the shortage of skilled workers, and increase the attractiveness of work. For energy and industry, subsidies or price limits are proposed to reduce energy bills for companies.
In the tax sphere, a reduction in income tax for workers is proposed, along with potential tax benefits for companies and changes to encourage investment. Regarding bureaucracy, proposals include accelerated permits for construction and business projects, fewer forms, and simpler rules.
In the area of investments, an increase in spending on roads, railways, digital networks, and green projects is proposed, as well as a reduction in delays for projects.
European Policy and Trade
Merz also emphasized the importance of strengthening fair trade rules, noting that Europe benefits more from open world markets than any other region. He added that industrial artificial intelligence (AI) remains exempt from EU regulation. The Chancellor stated that deregulation for businesses across the bloc must be initiated by mid-2027.
“This is our country, which is fighting itself,” said the Chancellor, calling on lawmakers to take responsibility for future social reforms. “We all bear responsibility for listening and then acting according to a serious analysis of the problems and serious proposals for solutions,” Merz added, even if “we do not always agree on every single point.”
He emphasized that “we all bear responsibility for the further development of our country, so that freedom, prosperity, justice, social security, and peace continue to prevail here in the future.”
Source: Deutsche Welle