Berlin- Germany's incoming centre-right coalition pledged Saturday to introduce tax cuts, health care reform and a "protective shield for workers" after it takes office next week. Chancellor Angela Merkel said the coalition's 124-page manifesto represented the start of a new era and showed that Germans could look to the future with confidence.
"We need long-term changes in society in order to master the challenges of the 21st century," she told a joint press conference with Guido Westerwelle, head of her new political partner, the pro- business Free Democrats (FDP).
The chancellor's Christian Democrats, its Bavarian sister party CSU and the FDP cemented their coalition after three weeks of negotiations that ended in the wee hours of Saturday morning.
The deal, which comes a month after Merkel's conservatives and the FDP won a parliamentary majority in a general election, paves the way for a new centre-right government to take office on Wednesday.
Key points of the agreement are 24 billion euros (36 billion dollars) in tax cuts, an overhaul of health care funding and a reduction in compulsory military service from nine to six months.
"We will not increase taxes or contributions, but will concentrate on growth," Merkel said, adding that new legislation would be introduced later this year with the aim of accelerating growth.
She said next year and 2011 will be decisive in combatting the economic crisis that has engulfed Germany, along with many other countries.
CSU chairman Horst Seehofer said a special fund would be set up as a protective shield to ensure that workers are not burdened by extra costs incurred by the federal labour agency and health insurance companies if unemployment rises next year, as anticipated.
Westerwelle, Merkel's designated deputy, is set to become foreign minister in the new cabinet, replacing Frank-Walter Steinmeier, whose Social Democrats were defeated in the September 27 election.
The FDP leader said that, after taking office, he would open talks on a withdrawal of US nuclear missiles deployed in Germany. His goal was to make Germany "a country free of nuclear weapons."
The 16-member cabinet features nine new faces, among them Philipp Roesler, 36, a doctor who was born in Vietnam and adopted as a baby by a German couple. He takes over as health minister.
Economics Minister Karl-Theodor zu Guttenberg takes over from Franz Josef Jung as defence minister, while Interior Minister Wolfgang Schaeuble is to head the finance ministry.
An FDP party congress is due to approve the new agreement on Sunday, with the CDU and CSU following suit on Monday. Parliament is set to re-elect Merkel on Wednesday, with the cabinet to be sworn in the same day.
The coalition contract, titled "Growth, Education, Cohesion," also calls for extending the life of nuclear plants due to be phased out by 2020, as well as placing limits on the powers of the state to spy on citizens' online activities.
The partners agreed to increase investment in education and research by 3 billion euros annually, raise family allowances and improve benefits for long-term unemployed.
The new government also plans to phase out German participation in the United Nations Maritime Task Force deployed off the coast of Lebanon since October 2006 to stop arms smuggling.
