Economy

Cupcake Owner to customer who are viewing the cup cakes on the display : "That'd be $5 for the cupcake."

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Customer :"!"

Wealthy Germany's forgotten poor

Retiree's tearful appeal to Merkel on TV draws attention to their plight

Ms Paweski barely gets by on her monthly state pension and housing benefit of €723 from which she pays €310 for rent and electricity. She grows vegetables as she cannot afford to buy groceries.

BERLIN - At first glance, Ms Christel Paweski's small plot of land, with its garden gnome and flowerbeds, appears to be the epitome of comfortable German retirement. Tucked away among the flowers are rows of potatoes, peppers and cabbage that the former nurse carefully tends.

   But her gardening is not a hobby - it's survival. On her meagre pension, the 70-year-old says she simply cannot afford to buy groceries at the store.

   Ms Paweski's plight and that of millions of other Germans living below or close to the poverty line burst onto the campaign for the Sept 22 national elections after she tearfully confronted Chancellor Angela Merkel on national television, asking whether the country's leader had forgotten the growing numbers of retirees and working poor who have missed out on Germany's economic success.

   "I didn't want to cry in front of her," she told Associated Press in the poorly heated, rickety wooden shack where she spent the last four brutal Berlin winters before recently finding an apartment she could afford.

   "But then I remembered how I used to go to bed with three pullovers and three pairs of socks in winter because I didn't have proper heating."

   Ms Paweski, who retired six years ago, barely gets by on her monthly state pension and housing benefit of €723 from which she pays €130 for rent and electricity.

   The amount of the divorced mother of one of relying on food handouts and homegrowth vegetables - and still sometimes going hungry in order to buy clothes - does not chime with the expectation most Germans have of being able to retire in relative comfort after decades of work. It also jars with the image of wealthy Germany as an oasis of prosperity amid Europe's economic turmoil.

   To be sure, with a booming export surplus, full tax coffers and an unemployment rate of 6.8 per cent, Germany is the envy of many of its European neighbours, which are enduring sky-high levels of joblessness and public debt.

   Berlin has encouraged Greece, Spain, Italy and others to emulate a series of economic reforms it began a decade ago that helped drive down the cost of labour and boost Germany's competitiveness.

   But many economists say the reforms have also pushed down real wages and put hundreds of thousands precariously close to the poverty line. Germany is also one of the few European nations that do not have a minimum wage. Since Dr Merkel came to power in 2005, the number of people considered in poverty - earning less than €869 after taxes each month - or on its borderline has grown by about 400,000 to 12 million, according to the Federal Statistics Office.

   Then there are the estimated three to five million of Germany's 80 million people who live in "hidden" poverty.

   Dr Marcel Fratzscher, president of the German Institute for Economic Research, called the drop in unemployment from 12 per cent in 2005 to 6.8 per cent today "certainly a big success".

   "But there's a significant number of Germans whose real income is lower today than it was a decade ago," he said.

   Dr Merkel - who has fervently preached austerity abroad - said she took Ms Paweski's case seriously, perhaps mindful that most polls put the combined share of votes for left or centre-left parties on a par with that of her centre-right coalition. "I haven't forgotten her," she said after Ms Paweski's emotional appeal.

ASSOCIATED PRESS