BERLIN: The German government will unveil a major savings plan by mid-2010 to put the country back on the road to fiscal health, Finance Minister Wolfgang Schaeuble said in an interview published Monday.

Schaeuble said the government would hammer out a savings package by July to begin whipping the country's public finances back into shape.

"We must reduce the structural deficit from 2011 by around 10 billion euros (14 billion dollars) per year," he told the Bild daily, referring to an austerity law passed earlier this year.

"That will be tough but we have to do it."

Schaeuble offered no details as to how he would bring about the savings, after admitting last week he was unsure where to begin cutting.

Massive spending to pull Europe's biggest economy out of its worst post-war recession has ripped a huge hole in the public purse.

Last week, Chancellor Angela Merkel's cabinet approved the 2010 budget, which foresees a record 85.8 billion euros in new debt next year.

Nevertheless, a disputed 8.5-billion-euro tax relief package by Merkel's new centre-right government cleared its final legislative hurdle despite serious reservations about its impact on the country's tattered public finances.

"There will be a lot of discussion among the coalition partners - and the federal government and the states - next year about the 2011 tax cuts," Goldman Sachs economist Dirk Schumacher noted.

"It is not clear at all whether there will be any meaningful tax cuts - or whether they will be simply off-set by other tax hikes," he added.

Meanwhile IG Metall union boss Berthold Huber called Sunday for a 100-billion-euro investment programme for German companies that might face a credit crunch as the economy picks up next year.

"Do we want to support good companies or do we let them fail because of a momentary liquidity shortage, or because they don't get any or very expensive loans," he asked in an interview with the Weser Kurier newspaper.