Monika Schnitzer, the country’s top economics expert, argues that the federal government lacks the willingness to implement reforms. “The government continually misses its own promises and the necessary decisions” she told “Welt am Sonntag”. She criticised the CDU, CSU, and SPD for heading into the federal election and subsequent coalition talks without concrete reform proposals, instead forming a commission to address all big projects.
Schnitzer pointed out that proposals for the social systems-especially pensions and health insurance-have been on the table for a long time, yet decisions keep being postponed. “Saying that we have state elections and therefore do nothing is a bad signal” she said.
Regarding pensions, the reform ideas are well known: phase out early retirement options, cap pension increases, tie the retirement age to life expectancy and raise it gradually. She also demands a decisive implementation of the originally planned hospital reform.
Clemens Fuest, president of the Ifo Institute, calls for cutting subsidies in the housing sector to tighten the federal budget. “Many energy subsidies are unnecessary and create high spill‑over effects-for example subsidies for heat pumps and insulation” he explained. Lower heating costs already provide a sufficient incentive for builders to properly insulate homes. He also says that smaller spending items-such as the housing‑savings bonus and the child‑building‑grant subsidy-are dispensable.
In the short term, Fuest sees two main savings opportunities: first, an immediate cut of one third in all legally non‑binding subsidies; second, a hiring freeze in the public sector outside the defense domain.