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Olaf Scholz in the Bundestag: Increases corporate aid
Photo: Christophe Gateau / dpa
The budget law is considered the royal right of parliament and the members of the German Bundestag have again made extremely generous use of it in the fight against the consequences of the corona.
After a debate, the majority voted in roll call for significantly higher new borrowing and approved the supplementary budget with new debts of 60.4 billion euros.
This means that Federal Finance Minister Olaf Scholz (SPD) can take out the record loan amount of 240.2 billion euros this year.
The total expenditure this year should increase by almost 50 billion to 547.7 billion euros.
Debt financed two fifths of the budget
Scholz had previously defended the record debt in plenary.
Thanks to massive financial aid for companies, for example, Germany has come through the crisis better than many other countries, said the SPD candidate for chancellor in the final deliberations.
"And we say today: We will hold out until the end of the whole time," said Scholz.
"Because after the pandemic we want to take off." The CDU / CSU and SPD voted for the supplementary budget.
FDP, Left and AfD voted against, the Greens abstained.
The supplementary budget provides above all for more money for economic aid (increase by 25.5 to 65 billion euros) and for health policy - for example for the purchase of vaccines and for compensation payments to hospitals, as well as help for families.
At the same time, it is intended to compensate for lower tax revenues.
The rules of getting into debt
Open the debt brake area
"The budgets of the federal and state levels are basically to be balanced without income from loans," says Article 109 of the Basic Law.
In future, the federal states will no longer be allowed to incur any debts that are independent of the economy, while those of the federal government will be limited to 0.35 percent of gross domestic product.
Valid since
For the federal government since 2016, for the federal states from 2020.
Commitment
The debt brake has constitutional status.
In economic crises or emergencies such as a natural disaster, the debt can be higher.
But there must be a binding plan for the repayment of the loans.
Debt leeway for Germany (measured against GDP 2018)
Around twelve billion euros for the federal government.
implementation
The federal government adhered to the debt brake until 2020.
Since then she has been suspended due to the corona crisis.
Expand Maastricht criteria area
Countries that want to adopt the euro must meet the convergence criteria of the Maastricht Treaty.
Accordingly, the new debt (deficit) may amount to a maximum of three percent and the total debt to a maximum of 60 percent of the gross domestic product.
The Stability and Growth Pact (SGP) means that these requirements must also be complied with after joining the euro.
Valid since
1993 (Maastricht Treaty) and 1999 (SWP).
Commitment
The Maastricht criteria are anchored in EU law, but have often been violated.
The EU Commission has therefore initiated numerous so-called deficit procedures, which, however, have not had any financial consequences.
Debt leeway for Germany (measured against GDP 2018)
Almost 102 billion new debt and a good two trillion total debt.
implementation
Germany broke both rules early on.
Total debt fell below 60 percent in 2019 for the first time in 17 years, but exceeded this level again significantly in the following year due to the corona crisis.
New borrowing was also well above the Maastricht hurdle in 2020 at just under five percent.
Because of the corona crisis, the EU suspended its deficit rules in the pandemic anyway.
Expand area of the Fiscal Compact
The fiscal pact was adopted as a tightening of the stability and growth pact after it was unable to prevent the European debt crisis.
Instead of just adhering to the three percent limit of the Maastricht criteria, the signatories of the fiscal pact should strive for balanced budgets in the medium term.
The state's indebtedness, which is independent of the economy, may not exceed 0.5 percent of the gross domestic product.
If the total debt is well below 60 percent, this limit increases to 1.0 percent.
Valid since
2013
Commitment
The signatory states must enshrine their goals in the constitution, as Germany did with the debt brake.
For the first time, the fiscal pact provides the possibility of financial sanctions in the event of non-compliance.
So far, no use has been made of this option.
Debt leeway for Germany (measured against GDP 2018)
Almost 17 billion, as long as the total debt is over 60 percent.
implementation
So far, Germany has complied with the debt rules of the Fiscal Compact.
They are currently suspended because of the corona crisis.
Area Black zero flaps
If government revenues and expenditures are the same, the bottom line is the proverbial black zero.
In this case, new debts are not necessary.
One also speaks of a balanced budget.
Valid since
-
Commitment
The black zero is not a legal requirement.
As a common goal of the Union and the SPD, however, it can be found in the current coalition agreement.
Debt leeway for Germany (measured against GDP 2018)
None
implementation
In the federal government, the black zero was reached in 2014 for the first time in 45 years and held until 2020.
Then the state made new debts of around 130 billion euros because of the corona crisis.
A good two-fifths of the budget for 2021 is financed by debt.
The debt brake anchored in the Basic Law has already been lifted for 2020 and 2021, and it is likely to fall again in 2022.
In 2021 alone, the upper limit set by the debt brake will be exceeded by around 216 billion euros.
FDP: Scholz wants to sweeten the election campaign with reserves of billions
Even the German Economic Institute (IW), which is close to the employer, advises the federal government to relax the debt rules in view of the immense debts.
"It needs future-oriented investments so that Germany can cope with the corona debt," institute director Michael Hüther said last.
In contrast, the Federal Audit Office recently sharply criticized the high loans.
The budget plans of the federal government stand on "feet of clay".
Although this imbalance was triggered by the corona pandemic, "the lack of necessary reforms in the years following the global financial and economic crisis is now taking revenge."
CDU head housekeeper Eckhardt Rehberg justified the high indebtedness with the upcoming federal election, after which there will only be one acting federal government until the end of the coalition negotiations.
Therefore it is "wise to have increased corporate aid again".
FDP housekeeper Christian Dürr accused Scholz of wanting to sweeten his election campaign as a candidate for chancellor with billions in reserves in the budget.
The so-called global additional expenditure, the funds of which are not specifically planned, is superfluous.
In addition, of the 95 billion euros in economic aid that Scholz spoke of, only 22 billion euros are actual aid, while the majority are loans.
Green politician Anja Hajduk said that her group gave express support for responding to the crisis with quick, effective and sufficient means.
However, help for recipients of the basic security would be neglected.
In addition, much higher investments are required in the coming years.
Too fast a repayment plan for the new debt unnecessarily restricts the financial scope for it.
apr / dpa / Reuters