New borrowing in 2022 will not be quite as high as feared – economy


The federal government had to take on significantly less new debt last year than planned when the budget was drawn up. As the Ministry of Finance announced on Friday, net borrowing of a good 115 billion euros fell short of plans by around 23.5 billion. This is still extremely high in a long-term comparison, but significantly less than in the record year 2021. At that time, the federal government had to take on 215 billion euros in new debt to cushion the Corona crisis.

Minister of Finance Christian Lindner evaluated the final budget as proof that the coalition “does not exhaust all legal possibilities of borrowing by hook or by crook, but only as far as necessary”. On the other hand, it shows that planning and approval procedures would have to be accelerated so that the investment funds made available would also be used. “In any case, there is not a lack of capital in the budget for shaping the future, but rather a lack of speed due to bureaucratic brakes,” said the minister.

Lindner’s statements are not just a signal to the coalition partners of the SPD and the Greens, who have repeatedly called for more funds for social programs in recent months. Rather, the minister is also likely to have the EU Commission and the European partner countries in mind, which in view of the Ukraine war and the immensely increased energy prices would like to launch additional debt-financed spending programs.

Lindner is happy about higher tax revenues and lower expenses

Both unexpected additional tax receipts and lower expenses contributed to the slightly better annual financial statements. Federal tax revenue climbed to a total of EUR 337 billion, almost EUR 9 billion more than planned. At the same time, the costs for corona aid, support for Ukraine, interest, guarantees and the replenishment of gas reserves were almost 21 billion euros lower than estimated. Since the federal government also transferred around six billion euros to the pension insurance system so that they can help older people pay their electricity and gas bills, the Ministry of Finance posted a bottom line of reduced spending of 14.5 billion euros.

Not included in the annual financial statements are the federal funds, which the opposition likes to brand as shadow budgets. According to information from government circles, around 30 billion euros flowed out of the so-called economic stabilization fund in 2022. The money went, among other things, to companies suffering from the energy crisis, and the federal government also took over the down payments of all gas customers in December to relieve them. Overall, the fund is filled with loans totaling 200 billion euros, which are to be used primarily to finance the electricity and gas price brake this year.

The special fund, endowed with 100 billion euros to strengthen the Bundeswehr, remained untouched in 2022. However, the Ministry of Defense concluded contracts with the armaments industry worth around ten billion euros, which must be paid for when the weapons and ammunition are delivered. Almost 14 billion euros flowed out of the climate and transformation fund – only half of what was actually planned. In view of the high cost of living, some citizens distanced themselves from the idea of ​​having their house insulated.



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