Christian Lindner: There is an 18 billion hole in the budget – economy

Christian Lindner: There is an 18 billion hole in the budget – economy

Almost two weeks have passed since the big bang Christian Lindner had shattered the schedule for preparing the 2024 budget. However, anyone who believed that the shock could prove beneficial and put an end to the dispute over money between the finance minister and his cabinet colleagues was clearly mistaken. On the contrary: At the moment there is little to suggest that the traffic light coalition will soon be able to make up for the second attempt to pass the key budget data in the cabinet, which was actually scheduled for March 15th.

Meanwhile, new numbers are making the rounds, which show once again the impasse into which the SPD, Greens and FDP have maneuvered themselves. After years of crisis budgets, special funds and unscheduled additional funds, the specialist departments had announced additional expenditure of 70 billion euros at Lindner for the coming year. The coalition shouldn’t actually be having any distribution debates at all, but on the contrary would have to discuss which department can save how much money in the coming year: Even without a single euro of additional spending, there is already a gap of 14 to 18 billion euros in the previous financial planning. And new loans are not a way out either, rather the maximum permissible net borrowing according to the debt brake is already taken into account when calculating the funding gap.

Citizens’ allowance, housing benefit reform, pension subsidy: It costs everything

The reason for the misery is that the income and expenditure situation has changed significantly since the previously applicable financial plan was drawn up in July last year. According to documents from the Ministry of Finance, rising interest rates and personnel expenses alone will result in additional expenditure of an estimated twelve to 14 billion euros in 2024. The new citizens’ allowance and the housing benefit reform cost six billion euros, tax law changes in connection with the increase in tax exemptions and the relief of the federal states in the costs of refugee care, local public transport and childcare will cost around ten billion euros. In addition, there is a higher pension subsidy and a whole range of other expenditure items.

Overall, this results in additional burdens of at least 38 billion euros. On the other hand, there is expected additional tax revenue of around EUR 18 billion and a slightly higher scope for new borrowing of around EUR 4 billion due to the economy. “This does not include new projects and plans by the departments,” says the ministry paper Süddeutsche Zeitung present. “In addition, a further increase in the interest rate level must be expected, with which the gap would continue to widen.” The figures show that there is still a long way to go before the 2024 budget and the financial planning for the years 2025 to 2027 are drawn up.

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