Billion gap in the 2025 budget
Lindner is apparently increasing the pressure on the departments
March 1, 2024, 2:12 p.m
The financial situation in the federal budget is not going well. According to a media report, Finance Minister Lindner therefore wants to commit the ministries to austerity measures. Criticism of Lindner apparently comes from Lower Saxony’s Prime Minister Weil – but for a different reason.
When drawing up the budget for 2025, Federal Finance Minister Christian Lindner is apparently relying on a strategy of escalating pressure on the other departments. This is reported by “Spiegel”. The kick-off will be a meeting of state secretaries on Thursday next week. Lindner’s new budget state secretary, Wolf Reuter, is supposed to explain the dramatic financial situation of the federal government to his colleagues from the other ministries who are responsible for the budgets and convince them to take a tougher austerity course.
As things stand, the federal budget is missing between 25 billion and 30 billion euros. Relief is therefore not to be expected, as an in-house tax estimate from the Federal Ministry of Finance showed. The persistently weak economy is now having an impact on tax revenue. The ministry says the gap must therefore be closed through savings. There are a number of ways to do this. In this way, the savings volume could be distributed equally among the coalition partners. The SPD, Greens and FDP would each have to raise a third of the amount in their ministries. However, it is also conceivable that the departments make cuts according to their size.
The project becomes more difficult the more expenses are excluded from the outset. Chancellor Olaf Scholz has already declared the defense budget and social spending sacrosanct. Unlike in previous years, Lindner apparently wants to impose spending caps on individual ministries this time. The procedure then boils down to an allocation of money by the Ministry of Finance. In the past, the departments could still register their wishes. This should be over now. It remains questionable whether Lindner’s colleagues will stick to it.
At the state secretaries’ meeting, the ministries will not find out how much money they will receive, the “Spiegel” continues. You will then be informed of this by letter. Lindner wants to ensure that the houses remain in the dark about what the others are getting. However, the procedure only works if the finance minister has the backing of the Chancellor. In fact, preparatory talks are already scheduled to take place between FDP politician Lindner, Scholz from the SPD and Vice Chancellor Robert Habeck from the Greens.
Because: Companies have bigger worries than tax burdens
Lower Saxony’s Prime Minister Stephan Weil expressed criticism of the finance minister. “Spiegel” quotes the Social Democrat as saying that he knows from “countless visits to companies” that the German economy has three main problems. “Firstly, energy prices, secondly, skilled workers, thirdly, over-regulation.” Every economic policy strategy must be measured by “whether quick and effective answers can be found to these pressing questions,” said Weil. “The topic of tax relief, however, hardly plays a role in my discussions with companies.”
Finance Minister Lindner recently called for companies to be given tax relief by abolishing the solidarity surcharge. The SPD and the Greens reject this as long as there is no counter-financing. Weil will meet with his 15 counterparts from the federal states for the Prime Minister’s Conference on Wednesday. In addition to refugee policy, the focus should also be on ways out of the economic crisis, energy prices and accelerating planning.