After the Budget Decision: Bundestag Approves Additional Spending Plan for 2023
Just like suspending the debt limit, a roll-call vote was held on the additional budget for 2023. With 666 votes cast, 392 parliamentarians voted in favor of the budget modification, while 274 were opposed.
During mid-November, the Federal Constitutional Court deemed certain special funds, in addition to the actual budget, inadmissible following a complaint from the CDU/CSU parliamentary group. Consequently, the traffic light coalition needed to establish a new legal basis for financing the electricity and gas price caps and the disaster aid following the Ahr Valley flood. This required a retroactive addition of nearly 45 billion euros to the standard budget. As a result, the debt limit stipulated in the Basic Law was surpassed.
The amended draft budget for 2023 now specifies a total expenditure of 461.2 billion euros. This represents a reduction of approximately 15 billion euros compared to the initial plan. The start-up financing of ten billion euros for the equity pension, as proposed by Finance Minister Christian Lindner (FDP), was eliminated from the additional budget.
Additional Insights
The supplementary budget for 2023 in Germany encountered unexpected challenges due to the Federal Constitutional Court's ruling. Here's a summary of the main developments:
- Court Decision: In November 2023, the German Federal Constitutional Court invalidated the allocation of €60 billion in unused pandemic-related borrowing to finance the German government's green transition through the Climate and Transformation Fund (KTF) as it conflicted with the debt brake rule[1][2][5].
- Impacts: This court decision created turmoil in the coalition's funding plans and triggered a severe financial and political crisis. The government was forced to retract the €60 billion from the KTF in November 2023[1].
- Negotiations: The controversy over the budget and the debt brake led to significant cuts in budgets managed by the SPD and the Greens ministries. For example, the Ministry for Family Affairs (led by the Greens) was given only €2 billion out of the €12 billion initially proposed, while the Ministry of Health (led by the SPD) received €16.2 billion, a reduction of one-third compared to the previous year[1].
- Government's Collapse: The failure to reach a consensus on the budget and the debt brake eventually led to the demise of the coalition government on November 6, 2024, when the chancellor dismissed the finance minister[1].
In conclusion, the approval of the additional budget for 2023 by the Bundestag did not proceed as intended because of the Constitutional Court's ruling, which deeming certain special funds inadmissible, leading to a severe financial and political crisis that contributed to the collapse of the coalition government.
