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Germany's conservatives promise voters 'stability and renewal'

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State Premier of North Rhine-Westphalia and leader of Germany's Christian Democratic Union (CDU), Armin Laschet, and State Premier of Bavaria and leader of the Bavarian Christian Social Union (CSU), Markus Soeder, speak to members of the media prior to a meeting of the CDU/CSU alliance's leadership on the eve of the unveiling of its electoral programme ahead of the September general election, in Berlin, Germany, June 20, 2021. Odd Andersen/Pool via REUTERS

  • Conservatives promise tax relief and tight public finances
  • Looking to cement poll lead with manifesto
  • Critics say it is unclear how plans will be funded
  • Germany votes in federal election on Sept. 26

BERLIN, June 21 (Reuters) - German Chancellor Angela Merkel's conservatives promised tax relief and tight public finances on Monday in an election manifesto they hope will propel them to victory in September's election, but critics questioned how the plans will add up.

The conservatives hope the manifesto, entitled "The programme for stability and renewal", can extend their regained poll lead over the Greens ahead of the Sept. 26 federal election, after which Merkel plans to step down.

"We need a decade of modernisation," said Christian Democrat (CDU) leader Armin Laschet, who is trying to freshen up the party's image after 16 years in power under Merkel. "We want to make our country faster, more efficient, more digital."

The CDU and its Bavarian sister party, the Christian Social Union (CSU), aim to become so strong that the scenario of a Greens-led, three-party coalition government is no longer realistic, Laschet told a news conference.

The conservatives have extended their lead over the Greens to about eight points in opinion polls despite a divisive battle over who should be their candidate to replace Merkel.

In their manifesto, the conservative alliance - or "Union" - promises tax relief and also underlines its commitment to Germany's so-called debt brake, which limits new borrowing to a tiny fraction of economic output.

"It is unclear how all this is to be financed," said Jens Suedekum, professor of economics at the Heinrich Heine University in Duesseldorf. "I expect that after the election the Union will be open to creative financing solutions."

The CDU/CSU could show fiscal flexibility after the election, as already hinted at by Laschet with a vague proposal for an off-budget, semi-public investment vehicle. read more

The conservatives' manifesto is in stark contrast to plans by the Greens to tax the rich to fund a carbon-neutral economy, and makes it more difficult for the two parties to form a coalition after the election. read more

"I am firmly convinced: the Germans do not trust the Greens with the chancellery," CSU leader Markus Soeder told a joint news conference with Laschet. "You can also do Green politics without the Greens."

Laschet and Soeder put on a show of unity after a bruising battle in April to be their parties' joint candidate for chancellor, in which the CDU leader eventually prevailed.

"Armin Laschet, we're going to rock this together," said Soeder, standing next to the CDU leader.

GREENS WILT

The Greens surged ahead of the conservatives in late April after picking Annalena Baerbock, 40, as their candidate to run for chancellor, with her promise of change capturing voters' imagination. read more

But since then a regional election setback, criticism over a Christmas bonus payment that Baerbock failed to declare to parliament and a suggestion that Germany should arm Ukraine have hurt the Greens. read more

An INSA poll on Saturday put support for the CDU/CSU at 28%, ahead of the Greens on 20%. The left-leaning Social Democrats (SPD) were on 16%, the business-friendly Free Democrats (FDP) on 13%, the far-right Alternative for Germany (AfD) on 11% and the leftist Linke on 6%.

The latest polls would not give the CDU/CSU enough support to form a coalition with the FDP, their favoured partner, but point to probably just enough support for a CDU/CSU coalition with the Greens, or a Greens-led tie-up with the SPD and FDP.

The conservatives, which are expected to approve their election programme on Monday, want to cap the corporate tax rate at about 25% from just under 30% now.

Reporting by Andreas Rinke; writing by Paul Carrel and Joseph Nasr; editing by Richard Pullin

Our Standards: The Thomson Reuters Trust Principles.

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