(de-news.net) – Saxony’s Minister President Michael Kretschmer (CDU) has advocated for more extensive structural changes, including increased productivity, labor market and long-term care reforms, looser climate standards, and quicker policymaking. He said that extensive adjustments will be required to boost growth and improve the nation’s long-term economic outlook, even if he welcomed recent coalition actions as a solid first step.
Germany will need far more ambitious reforms to restore productivity, competitiveness, and long-term economic growth, according to Saxony’s Minister President Michael Kretschmer (CDU), who argued that workers should also contribute to the country’s economic recovery. He said the goal was not to reduce wages but to increase productivity by extending working hours, maintaining that the 35-hour workweek was no longer appropriate under current economic conditions. Kretschmer argued that Germany’s economic success had long depended on a workforce accustomed to significantly longer working weeks and said that temporarily working additional hours without reducing pay would be preferable to risking job losses.
Turning to the debate over unpaid sick days, Kretschmer said most employees used sick leave responsibly, while only a small minority took advantage of rules allowing absences without immediate medical certification. He argued that public policy should place greater emphasis on protecting workers who were genuinely ill rather than accommodating abuse of the system. According to Kretschmer, such an approach reflected practices that had been common in Germany for decades and remained standard in many other countries.
Kretschmer also warned that rising long-term care costs were placing increasing financial pressure on municipalities. He noted that average pensions in eastern Germany remained well below the personal contribution typically required for nursing home care, leaving a growing number of older residents dependent on social assistance financed by local governments. He called for structural reforms to the long-term care insurance system rather than relying primarily on spending cuts and argued that any funding shortfalls should be covered through the federal budget because the program is a federal responsibility. He said the issue should be resolved by the fall as part of the proposed ‘Future Pact for Municipalities.’ On climate policy, Kretschmer favored less demanding targets, arguing that pursuing partial rather than complete carbon neutrality by 2045 would allow infrastructure projects to be completed more quickly, at lower cost, and with greater efficiency.
Broader energy, tax, and regulatory reforms needed
More broadly, Kretschmer described the recent measures adopted by Germany’s CDU-SPD governing coalition as an important beginning but insufficient to reverse the country’s economic slowdown. While acknowledging that the decisions represented initial progress, he argued that they did not yet amount to the broad reform package needed to restore sustained growth and strengthen Germany’s competitiveness. The coalition recently won parliamentary approval for legislation on statutory health insurance savings and building modernization while also committing to implement the Pension Commission’s recommendations and provide tax relief for lower- and middle-income households.
Kretschmer said Germany also needed substantial changes to its energy policy, climate regulations, and the broader relationship between citizens and the state. He argued that discussions with the SPD and labor unions suggested there was still an insufficient appreciation of the speed and scale of the country’s economic decline and maintained that considerably stronger action would be required. In his assessment, the government’s current measures largely adjusted public spending to weaker economic performance and lower tax revenues rather than introducing reforms designed to strengthen long-term competitiveness and growth.
He also called for faster and more decisive policymaking, saying the pace of political decision-making should reflect the seriousness of the country’s economic challenges. Pointing to continuing industrial job losses and the relocation of production abroad, Kretschmer argued that Germany and the European Union should focus on reducing regulatory burdens instead of advancing additional measures such as supply chain and deforestation legislation. He likewise criticized proposed increases in taxes and social contributions, describing them as an effort to stabilize public finances rather than stimulate economic expansion. Without stronger measures to encourage growth, investment, employment, and renewed business confidence, he argued, Germany would be unlikely to emerge from its prolonged period of economic stagnation.
