BERLIN (Reuters) - Germany’s Social Democrats (SPD) on Sunday formally endorsed former European Parliament President Martin Schulz as their leader and challenger to Chancellor Angela Merkel in what is set to be a tightly contested national election in September.

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The SPD has undergone a revival since nominating Schulz in late January, gaining around 10 points in opinion polls and signing up thousands of new members as the 61-year-old focuses his campaign on social justice.

“The SPD is back! We’re back!” Schulz told around 600 delegates at a party meeting in Berlin shortly before he was chosen as SPD leader in a vote in which all 605 of the valid votes gave him a ‘yes’. Delegates signaled with their hands they also wanted him to run for the SPD in the Sept. 24 election.

While the center-left SPD is slightly behind Merkel’s conservatives in the latest Emnid poll, it showed Schulz should be able to take power with a left-leaning alliance involving the far-left Linke and Greens in what would be the first time Germany has ever had a ‘red-red-green’ coalition at the national level.

“We want the SPD to be the strongest political force after the federal election so it gets a mandate to make this country better and fairer and to give the people of this country the respect they deserve and I want, dear comrades, to be the next German chancellor,” Schulz said.

He reiterated his calls for free education, more investment such as in nursing care and schools as well as qualification programs for the unemployed in a speech that earned him a standing ovation.

It is necessary to close the “intolerable pay gap” so men and women in both eastern and western Germany get the same amount of pay for doing the same work, Schulz said.

He also said he wanted to introduce special working hours - financially supported by the government - for those with families, but he did not give further details.

The former mayor of Wuerselen, a small town near the Dutch border, has made much of his humble beginnings and on Sunday recounted how he was born in western Germany as the fifth child of a policeman and housewife, who he described as “simple and very decent people”.

He said he was “lazy” at school and thought only of football, ultimately dropping out of school and losing his way before getting a second chance. Schulz later trained as a bookseller and opened a bookshop before becoming a member of the European Parliament in the mid-1990s.

His nomination for SPD leader followed a decision by Germany’s Foreign Minister Sigmar Gabriel to stand aside as SPD head because he thought Schulz had a better chance of winning the election.