The German government presented its 2024 budget to the parliament on Tuesday morning, with Finance Minister , of the neoliberal , hoping several years of government spending necessary to manage a series of crises: , , and a rise in energy costs.
“Today, the issue is a return to the debt brake — or, more precisely, to sustainable public finances in the long term,” Lindner told the Bundestag.
Lindner’s draft budget comprises €445 billion ($480 billion) next year, around €30 billion less than in 2023 but still around €90 billion more than in 2019, the last budget before the coronavirus pandemic. Nevertheless, almost all departments will have to make savings compared to this year.
The federal government suspended its constitutionally enshrined debt brake from 2020 to 2022, borrowing unprecedented amounts in various forms.
Defending his plans during a lively debate on Tuesday, Lindner pointed to the rapidly rising expenditure on servicing debt. Next year, he said, for interest payments alone would cost the state €37 billion. “The interest costs in the budget are now twice as high as the budget of the education and research minister,” he said. “We simply cannot afford new rampant debts. They simply would not be financeable.”
Limited social reforms
The cuts are not uncontroversial within the federal government, whose coalition also includes Chancellor ‘s center-left and the , both of whom favor more interventionist solutions to economic problems than Lindner’s FDP.
Some social reforms have been achieved: The basic benefit for the unemployed, now named “Bürgergeld” (literally, “citizens’ money”), will be raised by 12% at the start of next year — though that will do little more than match rapid inflation.
The Green Party has also managed to introduce one of its own key promises: Replacing Germany’s child benefit system with a fixed “basic guarantee” for all children, to be introduced at the start of 2025. But Green Party Family Minister Lisa Paus was forced to accept a much lower budget for the plan: €2.4 billion rather than the €12 billion she asked for.
Edited by Rina Goldenberg