Budget Committee agrees
Budget for 2024 is in place – with a debt brake
January 18, 2024, 7:35 p.m
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After weeks of struggle, the federal budget for the current year is in place. In the evening, the Bundestag’s budget committee decides on a budget in compliance with the debt brake. The finance minister is likely to be happy, but the farmers are not.
Federal Finance Minister Christian Lindner can plan new debt of up to 39.028 billion euros for the 2024 federal budget and, as things stand, can thus mathematically comply with the debt brake in the Basic Law for the first time since 2019. With this result, the Bundestag Budget Committee concluded its deliberations on the draft budget for 2024 in the evening. Total expenditure is planned at around 476.8 billion euros. The Bundestag is scheduled to pass the budget on February 2nd.
“As coalition factions, despite different perspectives, against the background of multiple crises and despite a difficult initial situation of these parliamentary deliberations after the Federal Constitutional Court ruling, we are drawing up a balanced budget”: This is what the budget keepers Dennis Rohde from the SPD and Sven-Christian Kindler from the Greens explained and Otto Fricke from the FDP after the meeting. The clear focus would be on social justice, economic incentives including tax policy, investments in climate protection, strengthening democracy and international cohesion. At the same time, subsidies would be reduced.
Actually, the federal budget for the current year should have been dry for a long time. However, a groundbreaking ruling by the Federal Constitutional Court in mid-November thwarted the traffic light coalition’s plans. The result: billions in holes had to be plugged in the budget and in the fund for investments in climate protection and restructuring the economy. The leaders of the SPD, Greens and FDP negotiated this for weeks – and they made highly controversial cuts and austerity decisions.
The decision on agricultural diesel remains
Consumers have to prepare for more expensive flights and higher prices for fuel and heating. The ticket tax for passenger flights as well as the CO2 price on heating oil, gas and fuel should increase and bring more money into the state coffers.
Because of the planned gradual abolition of tax relief for agricultural diesel, farmers across the country have been taking to the streets for weeks. Despite the protests, the traffic light coalition did not back down from these plans in the budget committee. “The traffic light coalition stands by this compromise,” said Green Party householder Kindler. Before the meeting, farmers’ president Joachim Rukwied threatened new, far-reaching protests from Monday if the planned subsidy cuts were not reversed. The previous protests were the “foreshock,” he warned.
But it is not yet entirely certain that the debt brake will be complied with again after several years, with exceptions, in 2024. The SPD, Greens and FDP agreed: If more money is needed to support Ukraine later in the year – for example because US aid is no longer available – additional loans could be approved. The debt brake anchored in the Basic Law only provides for a very limited net borrowing. However, in the event of natural disasters or other exceptional emergencies, it can be suspended if the state’s financial situation is significantly affected.