Ministry of Finance considers new budget talks necessary
Published: Thursday, Aug 1st 2024, 17:40
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The German government may have to fundamentally renegotiate its hard-won compromise on the 2025 budget. Two scientific assessments of planned projects have shown that "further discussions within the federal government and as part of parliamentary deliberations" are necessary, according to the Ministry of Finance.
Finance Minister Christian Lindner had commissioned the audit because there were doubts as to whether individual projects in the budget were constitutionally and economically viable. These projects were intended to halve the funding gap of 17 billion euros that still existed after the negotiations of the "traffic light" coalition (SPD, FDP, Greens). Otherwise, as Lindner had warned, there was a risk that the budget would be blocked.
However, the reports cast doubt on the plans. From the Ministry of Finance's point of view, savings measures must now be renegotiated. "Measures to strengthen the accuracy of social spending, on which no political agreement has yet been reached, could also reduce the need for action", according to ministry circles.
The budget negotiators Chancellor Olaf Scholz (SPD), Vice-Chancellor Robert Habeck (Greens) and Finance Minister Christian Lindner (FDP) had actually considered three measures that together were to raise eight billion euros. This involved loans to the railroads and the highway company as well as billions from the time of the gas price brake at the KfW development bank. However, as there was uncertainty during the negotiations, the plans were re-examined from a constitutional and economic perspective.
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