Verdi boss Frank Werneke calls for stimulus package

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Dusseldorf Verdi boss Frank Werneke is campaigning for massive government incentives to get the economy stunted by the corona crisis back on track. “We now need an economic stimulus package in the order of three to four percent of the gross domestic product – about 100 to 150 billion euros,” Werneke told Handelsblatt.

Together with other leading trade unionists and representatives of business associations, he will take part in a video conference with Chancellor Angela Merkel this Monday.

The Verdi boss wants to promote so-called consumer checks at the conference: “Because shops, restaurants and cultural institutions are slowly opening again, now is the time to talk about consumer checks,” he said. The service trade union envisages an amount of 500 euros for low and middle incomes, which melts as earnings increase so that the financial dimension does not become too large.

Werneke thinks nothing of a new edition of the scrapping premium to support the auto industry: “We are against favoring a mode of transport and sponsoring it with thousands of euros.” Instead, a mobility premium should be introduced in the amount of a job ticket, which is then available to the public Local transport, an e-bike, a bicycle or even the purchase of an electric car can be used.

Read the full interview here:

Mr. Werneke, how can the economy slowed down by Corona regain its footing?
We now need an economic stimulus package in the order of three to four percent of the gross domestic product – around 100 to 150 billion euros. Part of it should go to investments. Because even before the Corona crisis, there was a multi-year investment requirement of 50 billion euros each year.

Who should get the money?
Because shops, restaurants and cultural institutions are slowly reopening, now is the time to talk about consumer checks. We envisage an amount of 500 euros for low and middle incomes, which melts off with higher earnings so that the financial dimension does not become too large.

This does not help the industry in recession, especially the auto industry.
We are against favoring a mode of transport and sponsoring it with thousands of euros. Instead, we want a mobility premium roughly equivalent to a job ticket, which can then be used for local public transport, an e-bike, a bicycle, or even the purchase of an electric car.

Do taxes have to be increased to finance the stimulus package?
I am currently against tax increases. Even if national debt rises significantly above 80 percent of economic output, it is still low in international comparison. Instead of focusing on debt reduction now, it would be more important to focus on growth first. If this is achieved, we can grow out of debt in the future, as we did after 2009.

The first industry associations are demanding that the next round of increases in the statutory minimum wage be waived. What do you think?
I assume that there will be an adjustment to the minimum wage. This is also necessary to strengthen the development of purchasing power.

Low-wage workers hardly pay taxes, but social contributions do. Are there new threats?
The last thing businesses and employees need now are higher social contributions. The now agreed and necessary expansion of the corona tests alone would mean a significant increase in the health insurance contribution without a federal grant. For this reason, corona-related burdens in social insurance must be offset by federal funds.

The Corona premium for nursing staff, which was also decided upon your pressure, also costs …
Yes, but it is also appropriate and fair and is expected to be largely financed from budget funds, the long-term care fund is initially only in advance.

Collective bargaining is due for the municipalities in summer. With what expectation do you go in there if the tax revenue breaks away now?
We currently expect a deficit of € 40 billion in municipal budgets at the end of this year. If there is no protective shield for the municipalities, this would in particular lead to a significant slump in investment and worsen the investment backlog.

Will the staff save again?
The collective bargaining round is sure to be lively, and there are already initial signs of planned hiring freezes. But I don’t expect a wave of downsizing. Especially since we have made short-time work possible in the public sector by means of a collective agreement and the instrument is also used.

Public sector workers are still relatively well positioned in the corona crisis. What about the many self-employed people who will be affected by the shutdown for even longer?
We are not only allowed to refer to the self-employed in the cultural sector, event management or in the training market for Hartz IV. Baden-Württemberg pays a subsidy of 1,000 euros a month, other federal states are unable to do so. Here we need a sensible joint solution from the federal and state governments and no shifting of responsibility.

Minister of Labor Hubertus Heil said that the “heroes” of the corona crisis not only earned applause from the balcony and Merci chocolate, but also higher wages. Can you enforce that?
In nursing, the biggest problem is staffing – and we have achieved a lot in terms of tariffs and, in the last few weeks before Corona, we have increased staff numbers at large university hospitals, for example in Jena, Mainz and Schleswig-Holstein – we will resume this course soon. When it comes to payment, the sample will be put to the test in the next round in the public service, because almost a third of the clinics are publicly funded. I can already imagine how tricky the operators will be, and would be happy to come back to Mr. Heil.

In the care of the elderly you have so far been unsuccessful in trying to get a collective agreement binding for all institutions and regions …
I am confident that we will make progress soon. Because the topic is so in the spotlight that I have doubts whether private care providers can really evade any fixed tariff.

And what about the cashier in the supermarket, beyond individual corona bonuses?
There was also a lot of talk about heroines. However, we still have the problem of a large number of non-tariff-bound companies – often independent traders in the large cooperatives of Rewe and Edeka – with significantly lower wages. That is why we need a generally binding collective agreement for retail.

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