Berlin
The corona crisis is causing new, terrifying records. In its traditional “Night of Long Knives”, the Bundestag’s budget committee wrestled for seventeen and a half hours for the federal budget for the coming year. The politicians discussed more than 2000 amendments to the draft by Federal Finance Minister Olaf Scholz (SPD).
?? Highest mark reached
In the end, the committee drew the line under a budget with a new debt of around 180 billion euros, almost twice as much as Scholz had planned in his original draft and only a little below the historic high of almost 218 billion euros, which is for the current Corona- Crisis year 2020 is approved. More than a third of the budget is no longer covered by income and has to be borrowed. There is unanimous criticism from the four opposition parties, albeit with very different nuances. Scholz and Federal Economics Minister Peter Altmaier (CDU) meanwhile agreed on further crisis aid for the economy. This includes the bridging aid for companies that are particularly hard hit by the pandemic up to the 3o. June to extend. As in November, economic victims of the “Lockdown Light” will also receive financial support in December.
?? Frustration with countries
The budget experts from the coalition parties CDU, CSU and SPD agree with their colleagues from the FDP, Left and Greens on one thing: the countries should pay more for future crisis aid to the economy. They are currently recording a far better development in tax revenue than the federal government and are benefiting from many financial concessions made by Berlin in recent years. As demanded by the CDU in particular, they should no longer “slender” their feet. “The frustration with the countries is huge among all households,” said the FDP budget expert Otto Fricke.
?? Rework
Because the recently hoped-for weakening of the pandemic did not materialize, the budget for the coming year had to be improved significantly. Originally, Scholz wanted to get along with 96 billion new loans. Then he had already increased this amount to over 160 billion euros because of further necessary expenditure for crisis aid and health care expenditure, before the budget committee added 20 billion euros more. As he said on Friday, Scholz will not have to fully exhaust the approved debt limit of 218 billion euros for 2020. This means that for the two Corona years 2020 and 2021 there will be new loans totaling a good 300 billion.
The minister is also not expecting a significant increase in German national debt beyond the 71 percent of economic output that is estimated for this year. Overall, the federal government’s new budget for the coming year will include expenditure of almost 500 billion euros, only slightly less than this year.
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?? obstacles
Since the new federal budget, like the one for 2020, contains far more new loans than the debt brake in the Basic Law allows, the Bundestag has to resolve an extraordinary budget emergency with the Chancellor majority. The three opposition parties, the FDP, Greens and Left, want to abstain, while the AfD vote no. The Bundestag should finally adopt the figures in December.
?? Overspending
The main reasons for the renewed debt increase are above all additional economic aid and further expenses to combat the corona pandemic. The item of support for companies shows 39.5 billion euros (plus 2 billion euros).
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