The German cabinet yesterday agreed an unpopular package of spending and pension reforms to arrest Germany's upward-spiralling debts and ensure the country's compliance with the European Union's stability and growth pact.

The measures, which are part of plans aimed at cutting 30 billion deutschmarks ($16 billion ) from state spending next year, will face a rough ride when put to the Bundestag, the lower house of parliament, next month.

Some senior members of the Social Democratic party (SPD), the dominant partner in the ruling Red-Green coalition with the environmentalist Greens, have opposed parts of the package.

After yesterday's cabinet meeting, Mr Gerhard Schroder, the German chancellor, said "there will be no turning back".

The measures could also be blocked in the Bundesrat, the upper house, if the CDU and other opposition parties do well in elections in four Lander (states) next month.

Opinion polls show the SPD's support has slumped recently.