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German government tasks experts with proposing inflation-busting ideas

·1-min read
The sun sets behind the skyline of Frankfurt

BERLIN (Reuters) - The German government will establish a committee of experts and task them with coming up with policy proposals to combat the soaring cost of heating and gas, Chancellor Olaf Scholz said on Thursday.

The committee is to deliver ideas next month on how to bring down prices and soften the impact of high inflation on business and consumers, Scholz added.

He was speaking after the second round of government talks with unions and employers. This "concerted action", established first in 1967 when Germany fell into recession after its post-war boom, was revived by Scholz in response to the current cost of living crisis.

Scholz reiterated the government's offer to exempt one-off payments by companies to employees of up to 3,000 euros ($2,997) from taxes and social security contributions, if employers and unions can agree on the bonuses.

But the president of the BDA employers' association warned that many businesses could not afford such payments.

"A lot of businesses are at their financial limit right now," Rainer Dulger said.

Inflation in Europe's largest economy came in at 7.9% in August, driven largely by skyrocketing energy prices following a plunge in gas deliveries from Russia amid the Ukraine war.

($1 = 1.0007 euros)

(Reporting by Klaus Lauer, Writing by Rachel More; editing by Matthias Williams)