Policy Performance


Economic Policies

With a stable, growing economy, Germany falls into the top ranks internationally (rank 5) with regard to economic policies. Its score on this measure has declined by 0.2 points since 2014.

The government has reversed a course of liberalization in favor of greater regulation, including a minimum wage and pension-system expansions. However, export performance and employment growth have remained strong. The country’s stability during the euro crisis has allowed it to benefit from extraordinarily low interest rates on government bonds.

Despite rising wages, unemployment rates are low, aided by a comprehensive toolbox of active labor-market policies. The massive influx of refugees is viewed as a key challenge for future labor-market policymaking.

Growth has boosted tax revenue substantially, producing a balanced budget in 2014. Marginal income-tax rates remain high. While absolute debt has risen, growth has reduced the debt-to-GDP ratio more quickly than expected.

Social Policies

With a well-developed welfare system, Germany receives a high overall ranking (rank 12) in the area of social policies. Its score on this measure is unchanged relative to 2014.

A renewed focus on equity and quality has improved once-worrisome education outcomes. The country’s dual vocational-training approach has become a model for countries with high youth-unemployment rates. The new minimum wage marks a shift away from transfer-based income support.

The health care system is of high quality, but increasing costs are a concern. Parental-leave programs are generous, and child-care shortages are easing. Women’s employment rates have increased substantially since 2000, and fertility rates are climbing. Pension-policy reversals have raised sustainability questions.

The massive surge in refugees has caused considerable financial, logistical and social stresses. States and municipalities have received financial support, and targeted integration programs are being implemented. However, political and societal consensus on this issue has yet to be achieved.

Environmental Policies

As a leader in the renewable-energy sector, Germany falls into the top ranks (rank 5) in the area of environmental policies. Its score on this measure has improved by 0.2 points relative to 2014.

The country has launched a phase-out of nuclear power, but has balked at imposing a carbon tax to reduce use of emissions-intensive coal. Instead, large coal plants will also be shut, and subsidies given for energy efficiencies.

The country is a pioneer in wind- and solar-power technologies, as well as in energy-efficient infrastructure. By 2014, it had reduced CO2 emissions by nearly 27% compared to 1990, with a goal of 40% by 2020.

Germany is an active participant in shaping international climate policy. As G7 president in 2015, it helped ensure that climate policy was given a top priority in that group’s June summit.



Quality of Democracy

Reflecting a stable system founded on the rule of law, Germany’s score for democracy quality places it in the top ranks (rank 5) internationally. Its score on this measure has improved by 0.2 points overall since 2014.

Parties receive public and private funding, with some transparency concerns. Referenda are primarily used at the subnational level. The media is largely independent, with considerable diversity of ownership. Information-access laws are sometimes interpreted restrictively, but their provisions are being increasingly actively used.

Civil rights are generally respected, though intelligence-service spying scandals have prompted serious criticism. While non-discrimination laws are broad, court rulings are sometimes required to ensure or extend protections. A quota for women has been introduced for large companies’ supervisory boards.

The legal system, government and administration act predictably. Judicial review is strong. Corruption is rare, and political figures’ income-disclosure requirements have been strengthened.



Executive Capacity

Despite some inefficiencies during crisis periods, Germany falls into the upper-middle ranks (rank 14) with respect to executive capacity. Its score on this measure has fallen by 0.1 point relative to 2014.

Strategic planning has not been a government focus, with flaws becoming evident in the coalition’s handling of the refugee crisis. The domestic agenda stems largely from coalition-partner negotiations. Coordination and communication breakdowns between the Chancellery and line ministries became particularly evident during the refugee crisis.

Several RIA programs are in place, producing generally high-quality reports. Sustainability concerns are regularly reviewed. The government routinely meets with societal stakeholders. The coalition has achieved many goals effectively, although some areas such as migration policy are marred by lack of clarity.

The coalition committee has informally become the most important venue for reducing inter-governmental disagreement, with ministers openly clashing during cabinet meetings. Subnational task funding is a consistent point of tension.

Executive Accountability

Despite a few recent oversight challenges, Germany’s overall score for executive accountability places it in the top ranks (rank 6) worldwide. Its score on this measure has declined by 0.4 points relative to 2014.

Parliamentarians have sufficient resources and strong executive-oversight powers, with some recent exceptions emerging regarding the intelligence services. The Federal Court of Audit is well-funded and powerful. A parliamentary committee serving an ombuds function has limited importance.

Citizens demonstrate a low average level of political knowledge, reflecting a decline in political interest. Public trust in the media has declined, particularly regarding refugee issues. However, public broadcasters do offer in-depth political reporting.

Decisions within the main political parties are made largely by top party elites. Employers’ organizations and unions are powerful and sophisticated. Other interest groups are increasingly influential, particularly at the local level.
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