IZA Tower Talk - Report

Thea Dückert, MP at IZA Tower Talk

On July 10, 2003, IZA welcomed Dr. Thea Dückert, MP as guest speaker at the 2nd IZA Tower Talk. Dückert is vice chair and labor market expert of the Green Party parliamentary faction in the German Bundestag. In her speech she analyzed the vast need for reform in Germany. According to Dückert, the labor market reform efforts combined in the concept presented by the Hartz Commission and in the Agenda 2010 merely "mark the beginning of more comprehensive measures yet to come."
	She rebutted the accusation by unions that the proposed reforms would negatively affect certain groups in society while favoring others such as civil servants. "The German people comprehend faster than their politicians", she said. "They know that it will take fundamental reforms of the labor market and the social security system to ensure the future functioning of our welfare state." Dückert also rejected the argument that the Green Party gets crushed between the two major parties as their positions are increasingly converging: "The reform proposal by the German government has an unmistakably Green touch to it." The topic of her speech, "Redefining Solidarity – Creating Fair Access to the Labor Market", hinted at the Green Party’s new approach to restructuring the labor market and the welfare state according to what has come to be called "Flexicurity". This concept is based on enhanced flexibility, the reduction of red tape, the removal of obstacles to employment, and the requirement of more individual initiative on the part of the unemployed. At the same time, the goal of this initiative is to ensure the sustainability of a modified social security system.
Dückert named the redesign of the German crafts code as one example of abolishing obsolete privileges and employment impediments. The merging of unemployment assistance and social welfare benefits is supposed to create more flexibility. This reform would not only lead to a slimmer bureaucratic apparatus but also reduce the discrimination of welfare recipients. It would furthermore relieve the budgets of the municipalities, which would no longer be responsible for this new form of unemployment assistance. The labor market expert of the Green Party also emphasized the need to restructure the intergenerational contract more thoroughly than what has been discussed so far. To avoid placing an ever greater financial burden on labor, the current generation of retirees would also have to contribute their fair share. According to Dückert, the spiral of pension contribution hikes, which is accompanied by decreasing prospects of adequate old-age income security, needs to be stopped: "This is a misguided interpretation of solidarity." She also demanded that the "horrible practice of early retirement" be abandoned since the resulting vacancies often remain unfilled. With respect to demographic change, she called for a "culture of senior citizens’ work". The Green Party politician also advocated a form of health insurance that involves all groups of society while substantially reducing the financial burden on each individual. Given the desolate state of the economy, Dückert warned not to expect the current reform efforts to show a fast and visible impact. Although important steps have already been taken, they will require “some fine-tuning here and there” and still leave much to be desired. She also pointed at the high degree of political responsibility to be borne by the parliamentary opposition and the state representatives in the Bundesrat.