Germany’s chief chancellor, Helge Braun, on Monday called for changes to the way the government compensates businesses hit by the coronavirus starting next year, saying the current support scheme is unsustainable.
Government imposed a partial lockdown in November, closing bars and restaurants, stopping travel and limiting social contact.
It offers to replace companies with up to 50 workers, and are self-employed, up to 75% of turnover is lost in November and December due to restrictions. But Braun told me Handelsblatt state newspapers “are unable to act indefinitely.”
“Income cannot be the main criterion in the long term,” he said, calling current compensation an “ad-hoc measure.”
“In January, we have to provide more targeted assistance,” which will be tied to fixed business costs, he added.
Economy Minister Peter Altmaier also raised doubts, telling Deutschlandfunk radio that it was impossible to “offer such a comprehensive package as compensation payments for an indefinite period of time.”
Directly enter the company with a leave scheme
The German government has made an unprecedented number state aid is available to support the economy, but Braun said the pandemic still “left a significant mark”.
“The state can help ensure that most companies survive the crisis, but it will not be without consequences.”
He said there was still room for economic aid measures next summer, and voiced hope that a reduction in infection rates and a vaccination program could improve prospects before then.
As a sign of how The pandemic has affected the economyThe number of businesses in Germany using state-funded leave schemes rose in November for the first time in months, according to a study released on Monday.
Short work Short-term employment, as it is called, involves the state that bears a large proportion of the salary to prevent workers from being laid off.
The Munich-based Ifo Institute found that 28% of companies had enrolled employees for the program in November – compared with 24.8% in October. These figures are based on responses from a survey of around 7,000 companies from various sectors.
Ifo reports that short-term employment is increasing in almost all major sectors of the economy, especially the tourism and hospitality industries which are affected. The number of hotels using the leave scheme jumped from 62.9% to 91%, while in hotels the figure increased from 53.4% to 71.7%.
Merkel lashed out at the state prime minister
Also on Monday, Chancellor Angela Merkel criticized some state prime ministers’ decision to let hotels reopen over Christmas to allow family visits.
The chancellor told his party’s leadership conference that he saw this as particularly risky in major cities and regions with high numbers of coronavirus infections, according to sources cited by Reuters and Germany’s dpa news agency. The government has urged people to hold small gatherings at home and avoid unnecessary travel during the holiday period.
Under Germany’s federal structure, regional prime ministers have the final say on regulations in their states.
nm / msh (Reuters, dpa)