Germany's SPD agrees to exploratory govt talks with Merkel

Germany's Social Democrats agreed Friday to open exploratory talks on building a government with Chancellor Angela Merkel's conservatives, taking Europe's biggest economy a small step closer towards a new coalition. The leader of Germany's second biggest party SPD, Martin Schulz, said he and other leading Social Democrats would meet Merkel next Wednesday to draw up a timetable on talks, due to start in early January. But he stressed that his party had no plans to simply sign up to extending a lease on the right-left "grand coalition" that has governed Germany since 2013. Merkel has repeatedly said she wants a "stable government" -- shorthand for a grand coalition -- but Schulz insisted that cooperation could take "different forms". "There are many different models of what a stable government could be," Schulz told journalists after huddling with the SPD's top brass. "We want another culture of governance in our country. It will not be 'go on as before', it won't be a continuation of the grand coalition in the form as we knew it," he said. Addressing the annual congress of her Bavarian allies CSU, Merkel welcomed the SPD's decision to open talks, and said she has "great respect for the path that the party has chosen to take" since the September elections. Nevertheless, she shot down the SPD's call for a universal public health insurance system, saying "it won't work". - Germans back GroKo - The SPD is wary about hastily renewing its partnership with the conservatives after it suffered a stinging defeat in September's elections. A youth-led rebellion within the party is also putting up fierce resistance against a new grand coalition -- known as "GroKo" in Germany -- and any decision on the issue would have to be put to a vote of the SPD's rank and file. The SPD has repeatedly made clear that it has an array of options, including rejecting a partnership with Merkel's conservatives and setting Germany on the road to snap elections or supporting a minority government led by the veteran leader. It has also floated a third option -- a "cooperation coalition" or "KoKo" -- which could involve the two parties forming an alliance with agreement on some issues while leaving potentially contentious topics to parliamentary debates. The exploratory discussions are expected to be swift, Schulz said, with the SPD tentatively pencilling in a congress on January 14 to vote on whether to formally open coalition talks. Germans appear to be warming to the idea of a new GroKo, with a poll published by broadcaster ARD showing 61 percent in favour -- up 16 percentage points from a week ago. The option of a Merkel-led minority government received only 34 percent support in the poll.