According to the Federal Ministry of Finance, total spending in 2024 would still be 25% above the pre-crisis level of 2019.
The German Council of Ministers approved this Wednesday the budget project for 2024, which implies cuts in funds in all areas except defense.
The approved project cuts the budget for next year by 30.6 billion euros (about 33.3 billion dollars), affecting the departments of infrastructure, health and parental benefits, which will have to give up funding for some of their programs. The move has sparked friction within the ruling coalition made up of Chancellor Olaf Scholz’s Social Democratic Party (SPD), the Greens and the Free Democratic Party (FDP).
By 2024, Berlin envisions a new debt of 16,600 million euros (about 18,000 million dollars), respecting the debt limit of 0.35% of GDP. According to the Federal Ministry of Finance, total spending in 2024 would still be 25% above the pre-crisis level of 2019.
German Finance Minister Christian Lindner defended the draft budget, calling for a “back to normal in terms of financial policy.” “We are now ending the crisis mode of expansionary state finances,” said Lindner, who is seeking to prevent tax increases.
“Today we decided on a draft budget that recognizes the realities of financial policy“, he said, explaining that “unlike in the past, different political ideas cannot be covered up using more and more money.”
According to Lindner, the budget is “just the beginning of consolidation efforts” that will be an “ongoing task” for years to come, and he insisted on restoring the debt brake.
In this sense, he named three central priorities of his budgetary policy: the security “in a new geopolitical reality”, the “future opportunities“of the young, and the technology investments and climate friendly energy.
restructuring of the economy
In addition, Scholz spoke in the Bundestag on the 2024 budget and appointed safety as the main focus of planning, referring to comprehensive support to Ukraine. As a second priority he pointed out that Germany must remain “a modern industrial country” with a restructuring of the economy towards climate neutrality. Thirdly, the chancellor spoke of ensuring “the cohesion” of society.
With the new austerity policy, the Health Ministry is expected to face a one-third cut in its budget, which has intensified disputes within the government.
Source: RT
