Three-party deal to make Olaf Scholz German chancellor

Olaf Scholz will become Germany’s ninth postwar chancellor under a coalition deal that will hand him the reins of Europe’s biggest economy.

Three parties – the Social Democrats, Greens and Free Democrats – yesterday united behind a four-year programme that they said would equip Germany to tackle the climate crisis while preserving its economic might.

Mr Scholz is expected to succeed Angela Merkel early next month after a vote in the German Parliament, where the new coalition holds 416 out of 736 seats.

He said the new government would be “united by a belief in progress” and the “will to make our country better, to take it forward and to hold it together”.

The “traffic light” coalition, a nickname derived from the colours of the three parties, brings together leftists, environmentalists and pro-business liberals who have never previously co-operated.

But with few politically feasible alternatives, they came together behind a plan to create a digitised, low-carbon economy while maintaining Germany’s reputation for fiscal discipline.

The coalition plans to expand renewable energy, promote innovation, increase the minimum wage for 10 million people, protect pensions and build 400,000 new homes a year.

It will try to accelerate Germany’s coal exit to 2030 by setting a minimum price for carbon emissions.

“With ambition and perseverance, we will make our country a leader in protecting the climate,” Mr Scholz said.

In migration policy, the coalition plans to speed up the process for German citizenship, but expand Europe’s border agency and urge other countries to take in more refugees.

The coalition deal is the first alliance between three parliamentary blocs since the 1950s.

Mrs Merkel, who is retiring after 16 years in power, included Mr Scholz in a recent G20 summit and talks on tackling the coronavirus outbreak.

Her centre-right Christian Democrats will head into opposition after crashing to their lowest-ever vote share at the election.