Fund welcomed

The DGB, the main German union confederation, has welcomed the €130 billion (£112 billion) crisis package announced by German chancellor Angela Merkel on 3 June. The package, which comes on top of existing short-time working schemes to keep people in jobs, is to be spent this year and in 2021.

From 1 July to 31 December 2020, VAT on most goods will be cut from 19% to 16% and there will be a one-off payment of €300 (£270) for every child.

Domestic energy prices will be cut, and local authorities will get extra help from the centre to help them cope with falling tax income. There will also be additional investment in the railways and in local public transport and a €6,000 government grant (£5,400)for the purchase of each new electric car.

Reiner Hoffmann, head of the DGB, said that the whole package was “substantial” and he particularly welcomed the support for children.

However, the IG Metall metalworkers’ union was less positive as they wanted the support for the motor industry to cover all cars, not just electric ones. President Jörg Hofmann expressed the union’s “disappointment” that the grants had been so limited.