January 31, 2018 / 1:11 PM / a year ago

German parties agree on pensions as coalition talks progress

* Parties agree on pensions, care sector policies

* They want to conclude negotiations within a week

* Any deal still subject to vote by SPD party members

By Andreas Rinke and Thorsten Severin

BERLIN, Jan 31 (Reuters) - Chancellor Angela Merkel’s conservatives agreed with their would-be Social Democrat (SPD) partners on Wednesday to cap pension contributions, a sign of steady progress in coalition talks which both sides aim to conclude within a week.

Merkel, weakened after losing votes to the far-right in a Sept. election, is pinning her hopes for a fourth term on a re-run of the ‘grand coalition’ with the SPD to end four months of political limbo in Europe’s biggest economy.

After a breakthrough on the contentious issue of family reunions for migrants on Tuesday - although it was overshadowed by a subsequent row over the details - the parties ticked off some other, less tricky, issues.

They agreed to cap pension contributions, divided between workers and employers, at 20 percent of an individual’s salary to 2025, said party sources.

The SPD, which failed to win voters with a campaign focused on social justice, had before the election wanted a cap of 21.8 percent until 2030 from 18.7 percent.

In a blueprint deal agreed earlier this month in exploratory talks, the parties also agreed to stabilise pensions at 48 percent of the average wage by 2025.

Late on Tuesday, the parties also agreed on steps to create 8,000 more jobs in the care sector and improve pay.

Working groups are wading through the details of the framework deal on policies from Europe to tax and migrants.

The SPD are pushing for tweaks that will help its leaders sell a final coalition deal to its 440,000 members, many of whom are against joining Merkel’s conservatives again.

Any deal will depend on the approval of SPD members who will be balloted after party leaders agree - possibly at the end of the weekend or early next week.

Already, the JUSOS youth wing of the SPD has sharply criticised the deal on family reunions for migrants, saying the SPD leaders had not delivered sufficient improvements from the exploratory talks blueprint.

“If we don’t succeed in getting more out of the negotiations overall, we must break off talks with the conservatives,” JUSOS leader Kevin Kuehnert told Deutschlandfunk radio.

An unexpected intervention on climate policy came from across the Atlantic. Green activist and former Democrat presidential candidate Al Gore called on conservatives and Social Democrats to agree to phase out coal by 2030.

“This is your moment to lead and help solve the climate crisis,” tweeted Gore.

However, he may be disappointed. In the blueprint from exploratory talks, the parties said any government they form will agree a plan to reduce coal-generated electricity and put a date on the end of a phase-out, without indicating when.

They also agreed to meet 2050 climate goals at all costs, but gave a less concrete “recognition” of a 2020 target to reduce CO2 emissions by 40 percent from 1990 levels. (Writing by Madeline Chambers, Editing by William Maclean)

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