Germany awaits new government, but when?

Buoyed by the Bundestag’s approval of Germany’s proposed new debt package, CDU leader Fredrich Merz remains embroiled in negotiations with coalition partners CSU, the SPD and the Greens to determine when he might succeed SPD leader Olaf Scholz in the role of chancellor.

This week’s approval of the financial package proposed by the newly formed coalition government was a first. Germany’s Federal President Frank-Walter Steinmeier has since signed the amendment into law. The new legislation eases budgetary restrictions that previously limited spending on defence, civil protection, intelligence services, and cybersecurity while also creating a 500 billion euro special fund for infrastructure and climate protection, which will benefit Germany’s federal states.

Meanwhile, coalition negotiations continue but for how long remains unclear. Initially, agreement was supposed to be finalised before Easter (20 April), with CDU leader Friedrich Merz installed as the country’s new chancellor by the end of April.

Now, that timeline is being questioned. While the disciplined party line needed to ensure the successful outcome of the vote to revise the so-called “debt brakes” has paid off, Merz finds himself facing demands from within CDU that he pay the price for concessions previously made to the Social Democrats and the Greens for their support. Merz’s call for a “financial audit of our entire budget” sent ripples through CDU ranks and upset many Social Democrats, even though SPD leader Lars Klingbeil had indicated it was time Germany modernised its procedures. 

According to reporting by the Frankfurter Allgemeine Zeitung, problems within the 16-member working groups negotiating on finance, migration, and labour and social affairs have emerged. Issues could delay the 24 March deadline set for providing coalition leaders with developed proposals which were to serve as the basis for reaching a final agreement by the end of the month. Once that is done, SPD members will have the opportunity to vote their approval of the deal within ten days, an outcome that can only be validated if 20% of the party’s members participate. In the case of the CDU, a small party conference will decide, whereas, in the CSU, an executive board resolution will suffice.

The CDU, CSU, and SPD would command a majority with a total of 328 members in the new Bundestag. The CDU/CSU combination emerged as the strongest party in the federal election with 28.5% of the vote –208 members (CDU: 164, CSU: 44). The SPD plummeted to a historic low of 16.4% and will now have only 120 seats. 

The new legislative period begins with convening the 21st German Bundestag on 25 March, the latest possible date according to Article 39 of the Basic Law, since the new Bundestag must convene on the thirtieth day after the election. New parliamentary groups have already been constituted and have elected provisional or permanent new chairmen. The new CDU/CSU parliamentary group confirmed CDU leader Merz as chair with 98% of the vote. Merz will relinquish his seat if a coalition with the SPD is formed and he is elected chancellor.

The new AfD parliamentary group, which after the election is twice as large as before with 152 members, re-elected Alice Weidel and Tino Chrupalla as their co-chairs. The new SPD parliamentary group in the Bundestag elected party leader Lars Klingbeil as chairman. Green Party parliamentary group leaders have indicated that their actual appointments to key positions will be based on the timing of the formation of the government.

For the time being, Chancellor Scholz and his ministers remain in office until the new Bundestag convenes. However, in the current situation, Federal President Frank-Walter Steinmeier will then ask the Chancellor to continue in office until a successor is appointed. Ministers will also remain in office in an acting capacity. Germany, therefore, will not be without a government or unable to act while awaiting the formation of a new coalition. Until that happens, Chancellor Scholz will continue to attend international meetings, such as the meeting of the so-called Coalition of the Willing to Support Ukraine in Paris on Thursday next.