Germany's SPD party, under pressure, warming to idea of coalition government

Germany's Social Democrats bow to pressure from across the political spectrum to help form a new government led by Chancellor Angela Merkel, but pledges that party members would have final say on any deal.

SPD leader Schulz had said the voters had spoken against the same coalition but is more open now

Leader of the Social Democrats (SPD) Martin Schulz gives a statement in Berlin on Friday as Germany faces the possibility of another vote. A coalition has not yet come together several weeks after the last election. (Pawel Kopczynski/Reuters)

Germany's Social Democrats bowed to pressure from across the political spectrum on Friday to help form a new government led by Chancellor Angela Merkel, but pledged that party members would have final say on any deal.

The turnabout by the centre-left party, which had said it would go into opposition after suffering its worst result in 70 years in a September election, could help avert a disruptive repeat election in Europe's economic and political powerhouse.

SPD leader Martin Schulz told a news conference that party leadership had reached the decision out of a sense of responsibility to Germany and Europe after Sunday's collapse of talks aimed at forming a three-way coalition.

"There is nothing automatic about the direction we are moving in," Schulz said. "If a discussion results in us deciding to participate in any form whatsoever in the formation of a government, we will put it to a vote of party members."

Backing for a new government could come in various forms other than a coalition, including a formal agreement not to obstruct a Christian Democratic Union-led minority government or an informal agreement to tolerate it.

Rainer Haseloff, CDU premier of the eastern state of Saxony-Anhalt, told Reuters: "I think opinion is moving in the direction of there being a grand coalition, with Merkel as chancellor, at the end of the process ... "We are open to conversations when the SPD come with their proposals, but there will be a Chancellor Merkel and we won't budge from that," he said.

Merkel spoke with reporters after an event in Brussels, but declined to answer any questions.

Cat and mouse analogy

The decision to support a government is a fraught one for party members, who saw four years of constructive participation in a Merkel-led government rewarded by voters with its worst vote share since WW II.

Over her 12 years in power, Merkel has seen off a succession of coalition partners who went on to endure painful electoral defeats. A cartoon published by Cicero magazine on Friday depicted the SPD as a mouse being enticed out of its hole by a waiting feline Merkel.

German Chancellor Angela Merkel, shown during her weekly cabinet meeting on Wednesday, will have to strike a deal to serve her fourth term. (Clemens Bilan/PA-EFE)

Schulz will hold joint talks with Merkel and Horst Seehofer, leader of her Christian Democrats' Bavarian arch-conservative sister party, for talks hosted by President Frank-Walter Steinmeier next week.

Steinmeier, once an SPD foreign minister, urged his former party to go back on its pledge to go into opposition, having made clear that he saw fresh elections as a last resort.

The SPD has governed in coalition under Merkel since 2013, and that government remains in place in a caretaker role. Merkel is facing the biggest political deadlock of her career since efforts to forge a three-way coalition with the pro-business Free Democrats (FDP) and ecologist Greens collapsed last weekend.

That has raised worries across Europe of prolonged uncertainty in the world's fourth biggest economy.