No date in sight for end of Germany’s budget dispute
2023.05.24 11:32
© Reuters. Finance Minister Christian Lindner attends the weekly cabinet meeting at the Chancellery in Berlin, Germany May 24, 2023. REUTERS/Annegret Hilse
BERLIN (Reuters) -German Finance Minister Christian Lindner didn’t commit to a timetable for resolving a budget dispute between the three coalition partners on Wednesday, exposing cracks in the government and casting uncertainty over spending plans.
“We want to present plans for the budget soon,” Lindner said before answering questions in the Bundestag’s budget committee.
According to participants in the meeting, the finance minister only sketched out a rough plan in the 90-minute committee session.
Germany’s three-party government – comprising Lindner’s Free Democrats, the Social Democrats and the Greens – had been due to vote on the budget on June 21 after Lindner postponed the presentation of the final draft in March.
Lindner has since said that the June 21 deadline is no longer feasible.
The budget needs to be agreed after massive increases in spending during the coronavirus pandemic and higher energy costs as a result of the Ukraine war.
At the same time, several ministries have registered new projects that require financing. Chancellor Olaf Scholz vowed last year to ramp up defense spending in response to Russia’s invasion of Ukraine, sending weapons to Kyiv and modernizing its own military.
Sources told Reuters that the plan is to have a budget agreement between the coalition parties before the parliamentary summer break, with a first proposal ready by the first week of July and a detailed draft sent to the Bundestag by mid-August at the latest.
In the first week of September, the Bundestag could then discuss the budgetary proposal in a plenary session for the first time.
Lindner has said that more savings must be made and new spending should only come from existing funds.
According to government sources, there is a gap of around 20 billion euros ($22.02 billion) in the plans for 2024.
Germany’s finance ministry updated its tax estimates this month. It expects 148.7 billion euros less in tax revenues for the German state in the 2023-2027 period compared with previous forecasts published in the autumn of 2022.
Lindner has said on several occasions that Germany should adjust to the new budgetary realities but on Wednesday, before entering the budget committee session, he said there would be no blanket spending cuts in the 2024 budget.
($1 = 0.9084 euros)
