SPD parliamentary group leader Rolf Mützenich warns against going into the coming year without a fundamental agreement on the federal budget. A Bundestag decision is no longer possible before the end of the year. But everything must now be done to at least give security to those who depend on the resources, said Mützenich at the SPD federal party conference in Berlin.
Until a decision is made in the Bundestag, the so-called provisional budget management would apply from January. Then, for the time being, only expenses that are necessary to maintain administration and fulfill legal obligations are possible. Mützenich said that the SPD parliamentary group sees this as a problem – unlike Finance Minister Christian Lindner (FDP).
The provisional budget management procedure usually also applies after a federal election if the new government is unable to draw up a budget in the short period between the formation of a coalition and the turn of the year. For Lindner, a late budget decision is therefore no drama. The state is completely capable of acting, he recently emphasized. No authority will be closed and no salary will not be paid. Nobody who expects support will not receive it, said Lindner.
Scholz: No dismantling of the welfare state
At the party conference, Chancellor Olaf Scholz (SPD) expressed his confidence that he would be able to solve the traffic light coalition’s budget crisis. “We are not faced with an unsolvable task. Everyone now just needs to come to an agreement,” he said. “In such a situation there will be no dismantling of the welfare state in Germany.” After days of struggle between the coalition leaders over the 2024 federal budget, the debate about savings and a renewed suspension of the debt brake continues.
Scholz said the welfare state was one of the greatest achievements. It is part of the country’s self-image that no one is given up. The Chancellor expressly defended the decided increase in citizens’ money by around twelve percent at the beginning of 2024, which has also been questioned by the FDP, which is also in government. The significant increase is “used by those who actually think that what is paid to those who are currently out of work is always too much,” said Scholz. “But I think you have to resist.”
Social Minister Hubertus Heil (SPD) said on the TV channel Phoenix that everyone had to move forward in the negotiations and make compromises in the end. The Chancellor mentioned the SPD’s guardrails. “We will also have to talk about the accuracy of the welfare state, but not about social cuts,” said Heil. “That means, for example, that we don’t destroy the pension insurance, that we don’t endanger social security for those in need.” When it comes to pensions, stability is also needed for future generations. At the party conference in Berlin, party leader Saskia Esken called for the debt brake exception rule to be used again.
Debt brake remains in focus
With the party conference resolution, Scholz is now entering into further negotiations with Lindner and Vice Chancellor Robert Habeck (Greens). The FDP leader has repeatedly made it clear that arguments for suspending the debt brake have not yet convinced him. The three traffic light leaders are struggling to plug a 17 billion euro hole in the 2024 budget and to enable investments in climate protection and the modernization of the economy in the next few years. Scholz admitted that the situation was very difficult, “especially when you can’t just do it the way you think is right, but also have to come to an agreement with others.”
Saxony’s Prime Minister Michael Kretschmer once again referred to the great potential for savings in citizens’ money. “If, for example, a million more recipients of citizens’ benefit were to work, 30 billion euros could be saved per year. We are ready for measures that lead to this, but not for weakening the debt brake,” said the CDU politician to “Welt am Sonntag” .
Economist: Governments have missed planning for the future
The German Federation for the Environment and Nature Conservation (BUND) spoke out in favor of suspending the debt brake in 2024. Future projects, for example in the building sector and in the financing of renewable energies, should not be jeopardized, said chairman Olaf Bandt of the German Press Agency. The director of the German Economic Institute, Michael Hüther, told the dpa: “The traffic light and the previous governments failed to prepare the country for the future and they prevented constructive discourse about possible and sensible reforms of the debt brake.”
Economist Monika Schnitzer told the “Rheinische Post” that careful consideration must be given to whether the debt brake could be suspended again in 2024. She also spoke out in favor of abolishing “the climate-damaging diesel subsidy”, i.e. the tax advantage for diesel.
