Grants, guarantees and cheap loans: On April 8, the Federal Ministers for Finance, Christian Lindner (FDP), and Economic Affairs and Climate Protection, Robert Habeck (Alliance 90/The Greens), announced a billion-euro aid package for companies affected by the war in Ukraine. Among other things, this provides for a time-limited grant to temporarily contain the rise in natural gas and electricity prices for energy-intensive companies. Hard-hit companies are also to receive loans from the state-run Kreditanstalt für Wiederaufbau, with a framework of up to seven billion euros planned for this.
Photo: picture-alliance/dpa/Julian Stratenschulte
Energy-intensive sectors such as the steel industry in particular are to be helped with rapid lending and electricity price subsidies.
Habeck and Lindner said the federal government wants to develop criteria that will allow short-term credit lines. These are to be backed by a federal guarantee. A volume of 100 billion euros is planned for this.
Union also calls for a reduction in VAT on fuels
However, the opposition was apparently not satisfied with these announced aid packages. The CDU/CSU and Die Linke factions presented their own proposals for aid programs last week. Under the title “Immediate program for companies and employees” the Union called for better tax depreciation options for companies.
In addition, the high energy prices are to be mitigated by reducing the sales tax on electricity, gas and district heating supplies to seven percent for 2022 and 2023 and by temporarily reducing the sales tax on other energy products, especially fuels. Companies affected by the consequences of the war in Ukraine are to be temporarily supported “within the framework of the approved state aid framework through sureties, guarantees, loans or state participation”.
“We hear nothing about those who profit from crises and wars being involved.”
Alexander Ulrich (Left)
With its motion, the Left Party is calling for a Special fund of EUR 100 billion for energy security, energy sovereignty and ecological transformationIn addition, the federal government should set up a functioning state electricity price regulator within the next six months. In order to protect employees in companies affected by the crisis, the existing regulations on short-time work should also be extended beyond June 30, 2022 until at least the end of the year.
Progress should be made in reducing bureaucracy
For the Union, the measures planned by the federal government are inadequate, as Julia Klöckner (CDU) made clear in the debate in the Bundestag last Thursday. She said that the federal government’s reaction to rising prices, the stagnation of supply chains and the consequences of the war in Ukraine was “not a one-size-fits-all approach”. “The federal government is not providing an answer to the looming economic crisis,” said Klöckner. Among other things, she called for a reduction in bureaucracy and a relief law, because “small and medium-sized companies need room to breathe.” .
Coalition refers to its relief programs
Bernd Westphal (SPD) agreed with Klöckner’s statement that the economic situation is very serious. What is needed is a smart, balanced, intelligent policy. He then referred to the announced relief programs, which have been “on the way for a long time,” said Westphal. There is therefore no need for a motion from the opposition. He also believes that there is no shortage of money in the economy. “Companies have enough capital to get through this crisis too, with the help of the federal government,” said Westphal.
This is what the Federal Government’s protective shield provides for
⚖️ The Federal Government wants Support companies affected by the Ukraine warThe basis is the European Commission’s Temporary Crisis Framework.
📑 The proposed measures are currently examined under state aid lawapproval by the EU Commission may be required.
📈 In the short term, liquidity should be ensured and extreme natural gas and electricity price increases in energy-intensive sectors dampened become.
Enrico Komning (AfD) called the Union’s paper a “window-dressing motion”. The CDU and CSU had been part of the government for sixteen years: “What prevented you from implementing everything you are now demanding?” asked Komning. The Union talks about reducing bureaucracy, but it was actually the Union that built the “Mount Everest of bureaucracy”. The best thing, according to the AfD MP, is that the Union is now demanding an extension of the operating times of nuclear power plants. “You have buried coal and nuclear power and thereby caused the energy crisis and dependencies,” said Komning.
Greens: Heating in winter is more important than the SUV
Dieter Janecek (Greens) assessed the situation of the German economy as “relatively robust in view of the current crises”. It is nevertheless necessary to manage the crisis and act in a targeted manner. But: “We do not want to overload our budget,” said Janecek. The economic aid must be limited in time and used in a targeted manner: “I do not have to guarantee the basic price of petrol for SUV drivers, but I have to ensure that people who heat with gas, for example, get through the winter,” said Janecek.
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For the Left Party, Alexander Ulrich assessed the planned aid as “too unambitious and far too small”. Improvements must be made, said Ulrich. He called for companies to be required to contribute to the costs of urgently needed investments. “We hear nothing about those who profit from the crisis and war being involved,” said Ulrich.
Reinhard Houben (FDP) criticized the fact that the Union had already spoken about its proposal for an emergency program around two weeks ago, but had only now presented it. The CDU and CSU MPs had also not noticed which of their demands had already been implemented. “Aren’t you following the work of the federal government?” asked Houben.
Following the debate, the Union faction’s motion was rejected by the other factions, with the AfD abstaining; the Left faction’s motion was rejected by all other factions.
