Germany approves budget for 2023

“We are mastering the crisis, but we are not neglecting the future tasks of this country,” emphasized Finance Minister Christian Lindner (FDP). For the first time in three exceptional years, his budget maintains the debt brake. Due to the poor economic outlook, loans are still allowed.

Lindner spoke of record aid and investment, the SPD budget politician Bettina Hagedorn of a budget “that is not only huge in volume, but also finds the right answers to the needs of the times”. The Christian Democrats were particularly critical of the fact that the budget for the Bundeswehr would not rise to two percent of economic output, as announced by Chancellor Olaf Scholz. The left-wing and right-wing populist AfD generally saw the wrong priorities.

In total, the German budget for 2023 has a size of 476.29 billion euros. Large parts have to do with the consequences of the war in Ukraine and the high prices for gas, electricity and food. These include a multibillion-dollar housing benefit reform, a heating bill subsidy for the needy and tax relief.

For families that are particularly affected by high inflation, the child benefit will be increased to a standard amount of 250 euros per month and child. The former Hartz IV to support the long-term unemployed is being replaced by a citizen’s allowance with significantly higher benefit rates and new procedures from the employment office for the unemployed.

In addition, 48 million citizens will have to pay less tax. The state is losing 18.6 billion euros in income by compensating for the consequences of inflation in the income tax. In return, the basic deduction increases, i.e. the income on which no tax has to be paid. Other benchmarks in the tax rate will also be adjusted. This is intended to compensate for the fact that people have less purchasing power due to high inflation.

Left housekeeper Gesine Lötzsch accused the traffic light government of anti-social policies. The standard rate increase for the unemployed does not even compensate for inflation, crisis winners would not be asked to pay. Lindner replied, “Social justice is measured by the fact that people in need are not left alone. But social justice has another component, which is fairness to those who support this country through their work and pay high taxes and duties.”

The return to the debt brake was particularly important for the Finance Minister in his first budget, for which he was fully responsible. The poor economic forecasts, which still allow loans of 45.6 billion euros, help him in this. Lindner stressed that the federal government shouldn’t brag too much. The government deficit is huge, also because the energy price brakes are financed outside the regular budget through a special program filled with credits.

Trade union housekeeper Helge Braun called it problematic that no money was reserved in the budget for problems that were not yet known. “This budget has already been sewn to the brim,” he stressed. Lindner admitted that reserves were nearly exhausted. The budget for 2024 will therefore be a lot more difficult than this one. “So we have no alternative: we must remain courageous,” he stressed.

(SDA)