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Merkel Ally Seehofer Says Minimum Wage Will Be Part of SPD Pact

Nov. 23 (Bloomberg) -- German Chancellor Angela Merkel’s top Bavarian ally said her bloc will concede to the Social Democrats’ demand for a minimum wage, signaling the parties will overcome a chief hurdle in talks to form a government.

Speaking at a party conference in Munich, Christian Social Union Chairman Horst Seehofer said negotiations had shifted from whether the SPD wins its demand for a minimum wage of 8.50 euros ($11.50) an hour to who would be exempted and when it would be implemented. Merkel’s bloc and the SPD begin the final rounds of talks to form a so-called grand coalition tomorrow.

“There will be a minimum wage with a grand coalition,” Seehofer told CSU delegates today in Munich. “But we have to ensure that the minimum wage is introduced in such a way that as few jobs as possible are endangered. That is our task.”

Seehofer’s concession was the latest sign that a consensus is emerging among the main parties on one of the chief SPD demands to join a new government with Merkel. Confronting increased resistance in her party, Merkel has begun warning her base that it will have to concede to the SPD on the wage.

The CSU party chief, who is also the Bavarian prime minister, yesterday said he foresaw “difficult days” ahead as negotiators aim to wrap up two months of talks to form a German government by mid-week, on Nov. 27.

“We will hopefully be able to form a government and then this government will take up its work,” Merkel told the conference yesterday. “It certainly won’t always be easy.”

Best Result

Merkel’s Christian Democrats and the CSU had their best result in the Sept. 22 vote since reunification. The block is five seats short of an absolute majority in the lower house of parliament, forcing Merkel to find a governing partner.

CSU delegates, who re-elected Seehofer as party chairman with 95.3 percent of votes at the two-day conference, yesterday warned the SPD to reel in spending demands.

“The SPD has to recognize that it lost the election,” CSU General Secretary Alexander Dobrindt said yesterday in Munich. “We can only talk on that basis.”

The SPD agreed to enter talks to forge a government after two delegation votes and a menu of 10 “essential” demands, including the minimum wage. The party set up a further hurdle after it pledged to put any draft accord to a vote of its 470,000 members, a process due to take about two weeks.

To contact the reporter on this story: Patrick Donahue in Munich at pdonahue1@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net

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