Dispute over Germany’s 2025 budget gets rougher
Published: Monday, Jun 24th 2024, 16:00
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In the increasingly heated budget dispute between the German "traffic light" parties, Finance Minister Christian Lindner's FDP is insisting on its no to a renewed suspension of the debt brake and at the same time is taking a clearer stand against the SPD.
FDP Secretary General Bijan Djir-Sarai warned the larger coalition partner in Berlin on Monday against steps that are "toxic" for prosperity in Germany. "The SPD's debt populism in particular is also dangerous for the future and development of our country," said Djir-Sarai after a meeting of his party's executive committee.
In contrast, the SPD insists on greater leeway for new debt. The war against Ukraine represents "an emergency situation that we cannot cope with from a normal budget without painfully neglecting our tasks", said party leader Saskia Esken after the SPD presidium meeting.
The German government is currently negotiating the federal budget for 2025. Billions of euros need to be cut. Several departments do not want to meet Lindner's savings targets.
Federal Chancellor Olaf Scholz had defended the planned savings for the budget. On the question of an emergency situation due to the war in Ukraine, he recently said that it was now a matter of "first doing our homework and going through each individual budget item piece by piece and not somehow looking for the easy way out".
On Monday, the Chancellor held out the prospect of relief for the economy. The Federal Government wants to promote private investment, said the SPD politician at the Industry Day in Berlin. "I could imagine that we could go one better in terms of depreciation and research funding than what we have achieved with the Growth Opportunities Act."
The debt brake stipulates that the German state may only take out new loans of up to 0.35% of gross domestic product per year. As it is enshrined in the constitution, it could only be abolished with a two-thirds majority. The opposition Christian Democrats, whose votes would be crucial in the Bundestag, have reiterated time and time again that they would not go along with this.
The draft budget is to be approved by the cabinet on July 3. Following the heavy losses suffered by the "traffic light" coalition in the European elections on June 9, this is seen as the moment of truth for the continued existence of the coalition between the SPD, FDP and Greens.
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