Michel: Only use emergency loans to combat crises

In times of financial uncertainty, the Saxon Court of Audit advocates for prudent economic management, even when emergency loans are needed. According to President Jens Michel, these loans should only be used to combat crises and for a limited time. This approach ensures that debt takes on is compatible with the constitutional ban on new borrowing.

Michel underscores that emergency loans need to have a specific purpose. By adhering to this principle, debt rules can be upheld during normal times, allowing for financial flexibility when crises arise. Recently, the Federal Constitutional Court prohibited the German government from reallocating loans earmarked for coronavirus measures to climate protection. As a result, several projects financed by the federal climate and transformation fund are now in doubt.

The Court of Auditors consistently emphasizes the importance of sticking to debt rules during regular circumstances to create a reserve for addressing crises with sufficient financial leeway. By following this advice, regional authorities and the federal government can ensure their financial preparedness and contribute to effective crisis management.

While preserving the original meaning, the following sentences have been restructured to improve readability and maintain an informal tone:

1. The Court of Auditors and President Jens Michel urge the German government and regional authorities to restrict the use of emergency loans, stressing the need to adhere to debt rules during normal times to create a reserve for addressing crises later.
2. Emergency loans should have a specific purpose, and their use during crises should be limited, ensuring the constitutional ban on new borrowing is not violated.
3. The Federal Constitutional Court's ruling has put several projects under question, as it prohibited reallocating loans earmarked for coronavirus measures to climate protection.
4. The Court of Auditors' annual reports consistently remind that adherence to debt rules in normal times is crucial to build a buffer for addressing crises with sufficient financial leeway.

The enrichment data includes principles for managing emergency loans, emphasizing humanitarian consideration, a clear legal framework, transparency, accountability, adherence to human rights and democratic values, and coordination and collaboration between different levels of government and international organizations. These guidelines might not have been explicitly mentioned in the original article, but they could serve as useful insights to inform best practices in managing emergency funds.