German Chancellor Gerhard Schroeder dismissed a minister's proposal for further concessions over unpopular labour market reforms on Saturday, despite protesters plans to expand demonstrations next week.
The government agreed last week to some detailed amendments to the reforms which had led to tens of thousands of people taking to the streets in cities in former communist East Germany in protest on Monday.
Manfred Stolpe, the minister responsible for rebuilding the disadvantaged eastern states, told Welt am Sonntag newspaper that the amendments were significant.
"But we must work further on the terms of implementation of the Hartz IV (labour market) law," Stolpe said in the interview to appear in the newspaper on Sunday.
Stolpe suggested reviewing the level of assets set aside for old-age provisions, saying this was a particularly sensitive issue in the eastern states.
However, Schroeder told a meeting of the Social Democrats in the eastern state of Brandenburg, at which Stolpe was present, that further concessions could not be made.
"Anything that is made bigger must be paid for. And it must be paid with the taxes of the sales assistant and the semi-skilled worker who really do not have sizeable protected assets," Schroeder said in a speech.
Analysts have said Schroeder cannot afford to delay or soften the labour market measures, that are the final and most radical steps in his Agenda 2010 reform drive as the German economy, Europe's largest, continues to underperform.
At the meeting at the chancellery late on Wednesday, the government agreed to bring forward the first payouts for the long term unemployed by a month to fill a gap caused by the transition to new benefit rules.
It will also ease some means testing rules relating to children. The concessions are set to cost the government as much as 800 million euros ($980.5 million).
Under the so-called Hartz IV reforms, benefits for the long-term unemployed will be merged with social welfare payments, effectively cutting the money for many people out of work for more than a year. Benefits will also be means-tested.
At the same time, the government has pledged more active steps to get the jobless back to work more quickly, including scrapping conditions that allowed job seekers to turn down work which did not match their previous training or qualifications.
Demonstration organisers are planning a first march in the German capital this Monday when they also expect the number taking to the streets in Leipzig will double to 25,000.
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