Council of states releases several relief measures planned by the federal government

Source: Energy & Management Powernews, Oct. 31 2022

On Oct. 28, the Council of the Länder released several relief measures planned by the federal government. For example, the federal government is allowed to take on 200 billion euros in debt to reduce energy prices.

The Bundesrat confirmed in its meeting on October 28 several laws that are to relieve citizens from high energy costs. Thus, the federal government may take up to 200 billion euros in new debt to help companies as well as households with the high energy costs. Details of the planned energy price brakes are still open, however. So far, the gas discount payments for December are to be taken over by the federal government. A price brake is to apply starting from spring.

Retirees receive in December once 300 euro. The countries criticized however that further certain groups, for example maintaining members of the family or humans in parents' time without Elterngeldbezug, would not profit from the lump sum. The Ministry of Labor assured that this would be examined. The goal is to close the gap. Housing benefit recipients, as well as many students and trainees, will receive an additional heating allowance of between 345 and 415 euros in the fall. Overall, the federal government expects additional spending of about 551 million euros in 2022 and 2023.

In the law is also a new regulation for so-called Midi jobs: The upper earnings limit for employees in this group is to be raised from 1,600 euros to a maximum of 2,000 euros per month. Up to this limit, employees will in future only have to pay reduced social security contributions. This is expected to save them 1.3 billion euros a year. This was also part of the third relief package of the federal government.

CO2 tax on fuels will not rise again until 2024

The fuel tax (BEHG) will not rise by 5 euros to 35 euros/ton of CO2 next year as planned. The originally anchored increase will not come until Jan. 1, 2024. Starting in 2023, the tax will also apply to the combustion of coal in power plants. Operators of waste incineration plants will have to pay the CO2 price from 2024. The state chamber elected Hamburg's First Mayor Peter Tschentscher (SPD) as its new president by rotation.

The Bundesrat is demanding more state support for small and medium-sized businesses such as bakeries and retailers because of the high energy prices. They should be able to apply for aid from the energy cost containment program, which has so far been targeted at industry.

The program supports companies that cannot pass on sharply increased energy costs to their customers because of international competition. Current restrictions on companies covered by the guidelines on state aid for climate, environmental protection and energy should be lifted, formal hurdles in applications for small and medium-sized enterprises reduced, and the application deadline extended, the Bundesrat demands.

Länder dissatisfied with citizen's income scheme

The Länder see a need for improvements in the German government's plans for a new citizen's income scheme. The Bundesrat called on the traffic light government to review the costs and compensate for additional costs for municipalities and states. The citizen's income reform is to replace the previous Hartz IV system in Germany. The aim is to enable those affected to concentrate more on further training and job-seeking. In return, they are to be put under less pressure by the job center. The rule sets of the basic safety device are to rise around approximately 50 euro per month.

Some countries, like Bremen and Berlin, do not go the assistance, which the draft plans, far enough. Thus complained for instance the Bremen Sozialsenatorin Anja Stahmann (Greens) that the increase of the rule sets around 50 euro of the inflation and the high energy prices is neutralized. The left-wing Berlin Social Senator Katja Kipping emphasized that it was unreasonable to expect recipients of benefits to have to fall back on savings in order to replace defective household appliances such as washing machines or refrigerators. The union criticizes at the citizen money that it does not hold long-term unemployed sufficiently to a serious job search.

On 10 November the Bundestag will concern itself in second and third reading with the law to the citizen money. Afterwards the Bundesrat is again at the train. Without the consent of the states, it could come to the mediation procedure of the Bundestag and Bundesrat.

Author: Susanne Harmsen