The impending season brings about a wave of changes, labeled as the "Autumn of Reforms"

The black-red federal government, consisting of CDU, CSU, and SPD, has been in office since early May, and it's already clear that this coalition is gearing up for a season of reforms, particularly in the realm of social policy.

Vice-Chancellor Robert Habeck (Greens) and Federal Minister for Economic Affairs and Climate Action, Robert Habeck (Greens), have called for structural reforms in health, care, unemployment benefits, and pensions. They emphasize the need for more imagination than just wage cuts for employees.

The SPD, under Anke Rehlinger, is at the forefront of these reforms, with a focus on addressing the financial sustainability of the social state. They are considering reforms for the welfare state, particularly focusing on the very rich in the country. The SPD leadership has renewed demands for top earners to pay higher taxes due to multi-billion dollar gaps in the 2027 budget. SPD economic expert Sebastian Roloff suggested it would be fair to slightly increase the tax burden on top incomes, for example from 20,000 euros per month.

CDU General Secretary Carsten Linnemann, on the other hand, is sticking to his line that people with very high wealth and income should contribute to making society fairer, particularly in these extreme times. He compared the urgency of reforms to the situation 20 years ago before the Agenda 2010, implemented by then Chancellor Gerhard Schröder (SPD), stating that the social state is no longer financially sustainable.

Minister of Economics, Katherina Reiche (CDU), has sparked a debate on a longer working life, while Federal Chancellor Friedrich Merz (CDU) is dissatisfied with the achievements of the black-red coalition so far and believes more needs to be done. Merz called for improved communication within the coalition, urging both the SPD and his own party to talk with each other, not over each other.

The Social State Commission, set up by Federal Minister Barbara Bas (SPD), will present results by the end of 2025, as per the coalition agreement. This commission will make reform proposals for social benefits like unemployment benefits, housing allowance, and child supplement starting September.

Conflicts within the coalition have arisen due to the collapse of the election of new judges for the Federal Constitutional Court before the summer break and debates over the decision not to reduce the electricity tax for everyone. However, Rehlinger does not advocate for any thought taboos in the discussions surrounding the "autumn of reforms."

Merz reaffirmed the need for a realignment of social policy and expressed a desire for an SPD that continues the common path "critically of migration and friendly to industry." He also stated there will be no increase in income tax for medium-sized enterprises in Germany under his leadership.

The expected further sharp increase in social system costs in the coming years is a concern, with business associations complaining that it makes labor more expensive. Linnemann highlighted that the Agenda 2010, implemented by then Chancellor Gerhard Schröder (SPD), involved far-reaching reforms in labor market and social policy. The SPD is open to revisiting the inheritance tax, suggesting it offers many opportunities for design that often lead to a very low tax burden.

Merz urged all parties to demonstrate that changes and reforms are possible. He believes that this season of reforms will determine if politics is still capable of reform, particularly regarding the welfare state. The "autumn of reforms" is shaping up to be a crucial period for Germany's social policy.