The 2024 federal budget is under intense scrutiny due to a significant shortfall. Local authorities, climate activists, and the police are expressing concerns about potential cuts. The FDP is pushing for changes to the citizen's income, while the SPD insists on suspending the debt brake for the upcoming year. Time is ticking, and the coalition needs to get the budget through parliament this year.
Chancellor Olaf Scholz, Vice-Chancellor Robert Habeck, and Finance Minister Christian Lindner have been locked in talks to find a solution to the billion-euro hole. Lindner puts the deficit at 17 billion euros. Habeck, also serving as the climate protection minister, had to cancel his World Climate Conference trip due to budget concerns.
If a decision is made before New Year's Eve, a quick political call must be made, ideally before the cabinet meeting on Wednesday. A budget agreement in principle could be reached prior to Christmas, but the final passage may not occur until 2024's beginning. Without a political agreement by Christmas, a potential government crisis looms.
Savings pressure is mounting, with social issues, including the citizen's income, under consideration. Social Affairs Minister Hubertus Heil rejects demands to halt the 12% average increase at the start of 2024. Heil argues that it would be morally irresponsible and unconstitutional to deny those affected an inflation adjustment to standard rates.
The FDP continues to demand changes to the citizens' income calculation method, which dates back to the Hartz IV era. Christian Dürr, the FDP's parliamentary group leader, believes a reevaluation is crucial to maintaining the wage gap. Meanwhile, the German Social Association (SoVD) warns against cutting citizen's income, pointing to the struggles of those dependent on social benefits.
Instead of focusing on budget cuts, the SoVD advocates for a constructive debate on strengthening the revenue side. The Left Party's Martin Schirdewan suggests taking at least ten percent of the wealth of the country's richest ten billionaires in the form of a wealth tax. He criticizes the current social sector cuts debate as absurd.
SPD leader Saskia Esken insists on suspending the debt brake for 2024 to address indirect costs resulting from the Russian war against Ukraine. Many local authorities, concerned by the federal budget issues, support exemptions from the debt brake for important tasks such as climate protection and infrastructure.
The police union (GdP) warns against security sector cuts, with chairman Andreas Roßkopf urging Minister of the Interior Nancy Faeser to prevent further cost-cutting. Climate activist Luisa Neubauer cautions against reducing climate investments due to budget constraints, emphasizing the importance of investing in the future.
[1] Federal Government struggles with savings pressure [2] The future debt brake debate [3] Coalition partners and fiscal policy
