German employers criticise SPD plan to wind back labour reforms


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New Social Democratic Party (SPD) leader Martin Schulz addresses a news conference at their party headquarters in Berlin, Germany, January 30, 2017. REUTERS/Fabrizio Bensch

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BERLIN (Reuters) - German employers on Tuesday condemned plans by Social Democrat (SPD) leader Martin Schulz, who has overtaken Chancellor Angela Merkel in some polls before September's election, to revise decade-old labour reforms, saying they could hurt the economy.

In a clear bid to win back the left, Schulz told supporters on Monday that corrections were needed to former SPD Chancellor Gerhard Schroeder's Agenda 2010 welfare reforms.

The reforms are widely seen by economists as boosting the competitiveness of Europe's biggest economy in the last decade but they cost Schroeder his job and split the SPD apart, with many members leaving in disgust to the radical Left party.

"Agenda 2010 has supported jobs and reduced unemployment. Whoever wants to turn back time endangers this success," BDA employers' association chief Steffen Kampeter told the Passauer Neue Presse newspaper.

He said many of Schulz's suggestions had been formulated without exact knowledge of the numbers or the legal situation. The adjusted unemployment rate, 5.9 percent in January, is at its lowest level since German reunification in 1990.

Bild daily also criticised the ideas.

"The agenda reforms overall are just as correct as they were when they were introduced in 2005. And too important to be torn apart. SPD candidate Schulz must resist the temptation to chase after voters by rolling then back," wrote Bild.

At a campaign in Bielefeld, Schulz said there was no shame in correcting reforms. In particular, Schulz spoke about protecting older workers. He has also talked about introducing restrictions to temporary job contracts and defending pensions.

Under Schroeder, the most generous level of unemployment benefit was cut to 18 months from 32 months. Older people have slightly higher entitlements.

Schulz is keen to win back disillusioned leftist voters.

The appointment of Schulz to take on Merkel in the September election has reinvigorated the SPD and pushed them up by around 10 points in opinion polls, although the latest one showed Merkel's conservatives moving ahead again.

Schulz wants to oust Merkel and form a leftist coalition with the Greens and possibly the radical Left, a so-called "red-red-green" alliance. "Bride makes herself pretty for red-red-green," was the headline in Die Welt daily on Schulz's plans.

Some senior lawmakers from the Left, who have long attacked Agenda 2010, cautiously welcomed the plans. Party chief Katja Kipping said "the window of opportunity has got bigger but there is of course no blank cheque".

(Reporting by Madeline Chambers; Editing by Alison Williams)

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