Federal Finance Minister Olaf Scholz (SPD) has presented a concrete plan for EU unemployment insurance. The vice-chancellor sees better protection for the unemployed in times of crisis as essential to stop the further rise of right-wing populists.
The fund should be made up of contributions from Member States based on the level of economic strength. Germany would therefore deposit the most. The amount is still left open in a confidential paper that is available to the German Press Agency. First, the "Handelsblatt" reported on the so-called non-paper.
The move is part of a Franco-German initiative for a roadmap to stabilize the eurozone. The European "Unemployment Stabilization Fund" (EUSF) is designed to support the national insurance systems for the unemployed in times of deep slumps: they could borrow money from the EUSF in order not to cut benefits at the expense of their citizens.
Whether a crisis situation with a tapping of the EUSF is present, the member states should decide after a recommendation of the European Union commission. One criterion could be that the unemployment rate has risen by two percentage points within a short period of time, increasing the corresponding expenditure - money that could be missing elsewhere to combat the crisis, such as economic stimulus packages.
Union rejects the "Scholz Plan"
It is also about "strengthening solidarity between the Member States," says the paper. In addition, the aim is to harmonize the unemployment insurance systems more strongly.
However, Scholz's plans are met with rejection by the coalition partner. "With the Union, there will be no EU unemployment insurance," said Union Vice-Leader Carsten Linnemann, who is also head of the CDU SME Association, the "Handelsblatt". This would mean "a pooling of additional risks".
Also from the FDP the plans of Scholz were criticized. "There is no point in wanting to solve Europe's problems with Germany's money through the transfer of tax and contribution funds at the present time," said parliamentary vice-chairman Michael Theurer to "Handelsblatt". Only when a basic equivalency of living conditions has been achieved can European social policy be discussed as a vision of the future.