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German coalition split over measures to combat economic gloom

Wolfgang Kubicki, deputy chairman of Germany’s Free Democratic Party (FDP), has admitted the collapse of Germany’s ruling coalition, which could happen due to the Green Party’s disagreement with the bill on transferring refugee benefits to credit cards.

Kubicki told reporters:

If the Greens disrupt the vote on the minimum changes to the Asylum Seekers’ Benefits Act, it will call into question the further continuation of the ruling coalition. Because by doing so they are contributing to more and more people turning away from the policies of the federal government and beginning to doubt the competence of democratic institutions and their ability to solve problems.

In November, the German government as well as the federal states decided that asylum seekers in Germany will in future receive benefits on bank cards rather than in the form of cash. The new system involves the local administration transferring funds to a special payment card every month, with card users only being able to make purchases in a certain region.

When the balance reaches €5,000, the new funds are suspended. As noted by the authors of the initiative, such a measure is designed to establish control over transactions made by refugees and limit the possibility of transfers to their home countries.

In mid-January, the authorities of the district of Greiz, Thuringia, issued the first 200 cards to refugees, and by the end of the month the number of participants in the experiment with payment cards increased to 740 people.

A similar practice was launched in a test format in a number of other German regions. At the same time, as the interim results showed, the first refugees who were deprived of cash began to leave Germany en masse.

To legalise the practice, the government made the necessary amendments to the migration law. A vote in the Bundestag is scheduled for the coming week.

However, a few days before the parliamentary session, the Green Party, a partner in the ruling coalition, opposed the adoption of the bill. According to the party’s MPs, replacing cash with bank cards is a “discriminatory measure”.

Media reports that a number of MPs are in favour of refugees having “unlimited access to cash”. At the same time, the parliamentary faction of the “Greens” is ready to agree with the initiative of their colleagues, but insists that in return the partners agree to the requirement to grant the right to registration to migrants without passports.

The deputies said that such a measure is necessary so that undocumented refugees can go to medical centres without fear of further deportation.

The Greens’ ultimatum has already “infuriated” Chancellor Olaf Scholz’s coalition partners from the FDP and the Social Democratic Party of Germany (SPD).

As Kubicki pointed out, the FDP is strongly opposed to the condition of registering refugees without passports and is not prepared to compromise with its colleagues. If the bill on the transfer of benefits is not passed without additional conditions, the party will be ready to withdraw from the government.

The determination of the FDP leadership’s intentions is confirmed by reports that appeared in the media in early February about the Free Democrats secretly discussing the prospect of leaving the ruling coalition amid falling ratings.

An anonymous high-ranking source in the FDP said that the Liberal parliamentary faction is currently waiting for the “most opportune moment” to announce its decision. That opportune moment could be the upcoming vote on migrant benefits.

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