The German Chancellor wants to protect the poorest households from the soaring energy prices expected this fall.
German Chancellor Olaf Scholz on Thursday promised a new aid package for individuals in the face of soaring energy prices set to worsen this fall, while reaffirming his commitment to the return of budgetary discipline next year. . “We will do everything to ensure that citizens overcome these difficult times“, said the Social Democrat during his first summer press conference, which his predecessor Angela Merkel had made a tradition.
If the plan concerns all layers of the population, it will focus on the most modest households, with tax cuts or housing aid, explained the chief executive, in office since December, without going into more in details. He also did not specify the deadline and the cost of the package.
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At the same time, he reaffirmed his commitment to respect the constitutional rules of budgetary discipline again in 2023, after three years of exception in the face of the Covid-19 pandemic. “We estimate that we will be able to carry out our projects within the financial framework available so far.“, did he declare. Some voices, notably within the government-allied Greens and the SPD, have called for an extension of the suspension of the “debt brakein the event of a sharp deterioration in the German economy.
A spike in energy prices in the fall
Growth remained flat in the second quarter, weighed down by the acceleration of inflation in the wake of the war in Ukraine. This is one of the poorest performances in the euro zone from April to the end of June. And autumn and winter promise to be daunting in Europe’s main economy due to the energy crisis “yet to come for the economy“said the Minister of the Economy, Robert Habeck. The Germans will in particular see their heating and electricity bills soar in the fall with the government’s decision to allow the passing on of the rise in energy prices to the end consumer.
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The day before, the German Minister of Finance, the liberal Christian Lindner, had announced a series of tax measures amounting to 10 billion euros in 2023 to mitigate the surge in prices following the Russian invasion of Ukraine. Germany has already put in place aid totaling 30 billion euros to relieve individuals, recalled Olaf Scholz, including discounts at the pump or the popular 9-euro ticket, which allows travel in public transport and regional trains for one month. However, the measure stops at the end of August.