Advertising

The Seattle Times Company

NWjobs | NWautos | NWhomes | NWsource | Free Classifieds | seattletimes.com

Business / Technology


Our network sites seattletimes.com | Advanced

Originally published Monday, June 7, 2010 at 1:56 AM

Comments (0)     E-mail E-mail article      Print Print      Share Share

Germany to unveil cuts to welfare, jobs

Germany was close to finalizing Monday a major package of government savings, which would likely cut social welfare benefits, slash public sector jobs, and raise taxes to tackle the budget deficit.

Associated Press Writer

BERLIN —

Germany was close to finalizing Monday a major package of government savings, which would likely cut social welfare benefits, slash public sector jobs, and raise taxes to tackle the budget deficit.

With the debt crisis undermining the euro, Chancellor Angela Merkel's government is determined to tackle Germany's deficit - which while among the smallest in Europe is still above the official EU limit.

Several other countries - notably Greece, Spain and Portugal - have already embarked on much tougher austerity drives.

Merkel brought together her Cabinet for a two-day meeting at the chancellery that started Sunday to discuss the package. She said as she went into the meeting that Germany can no longer live beyond its means, insisting "we can only spend what we take in."

"Our citizens' greatest concern is that public deficits could grow to become immense," Finance Minister Wolfgang Schaeuble said.

Measures reportedly under consideration include cuts to public-service jobs, a reduction of handouts to new parents and new taxes on power providers.

Germany had a budget deficit of 3.1 percent of gross domestic product last year. It is expected to exceed 5 percent this year, still well above the European Union's 3 percent threshold.

Officials say Germany needs to save euro10 billion ($12 billion) a year through 2016 to meet a constitutional balanced budget requirement.

Opposition politicians and union officials criticized the prospect of cutbacks on social spending.

The head of Germany's labor union federation, Michael Sommer, argued that Germany should increase taxes for the rich and introduce a financial market transaction tax to help narrow its budget gap.

"In a situation like this ... we must do everything to stabilize the state's finances - and that means those who have more really being drawn on to finance this state," Sommer said on Suedwestrundfunk radio.

E-mail E-mail article      Print Print      Share Share

More Business & Technology

UPDATE - 09:46 AM
Exxon Mobil wins ruling in Alaska oil spill case

UPDATE - 09:32 AM
Bank stocks push indexes higher; oil prices dip

UPDATE - 08:04 AM
Ford CEO Mulally gets $56.5M in stock award

UPDATE - 07:54 AM
Underwater mortgages rise as home prices fall

NEW - 09:43 AM
Warner Bros. to offer movie rentals on Facebook

More Business & Technology headlines...

Comments
No comments have been posted to this article.

advertising


Get home delivery today!

Video

Advertising

AP Video

Entertainment | Top Video | World | Offbeat Video | Sci-Tech

Marketplace

Advertising