Bundestag suspends debt brake for 2023
The Federal Constitutional Court is forcing the traffic light government's hand: in order to put the budget for the current year on a legally sound footing, the Bundestag is once again suspending the debt brake.
The Bundestag has suspended the debt brake enshrined in the German constitution for 2023 for the fourth year in a row. The decision was made with the required majority of chancellors, with 414 votes in favor, 242 against and nine abstentions. The Federal Government justified this with an exceptional emergency situation as a result of the war in Ukraine, which is provided for as an exception in the Basic Law.
The suspension of the debt brake is a prerequisite for the adoption of a supplementary budget for 2023, which essentially places the loan financing of energy price aid from the WSF crisis fund on a different legal basis. Earlier credit authorizations had expired due to a ruling by the Federal Constitutional Court. The supplementary budget is due to be passed by the Bundestag this morning and will later pass through the Bundesrat.
With the supplementary budget, the federal government exceeds the borrowing permitted under the debt brake by 44.8 billion euros with planned new borrowing of 70.6 billion euros. Of this, 43.2 billion euros is for energy price subsidies for gas, district heating and electricity. Around 1.6 billion euros are earmarked for the flood relief fund following the flood disaster in the Ahr valley in 2021. Its financing from old credit authorizations was also invalid after the Constitutional Court ruling on the Climate and Transformation Fund (KTF).
The court had ruled that loans taken out under suspension of the debt brake may only be used in the year in which the emergency was declared. The court therefore canceled 60 billion euros that the Ampel government had transferred to the KTF from coronavirus loans.
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The suspension of the debt brake in the Bundestag allows for the consideration of a supplementary budget in 2023, which is necessary to legally justify the financing of energy price aid through the WSF crisis fund. The supplementary budget aims to bypass the expiration of earlier credit authorizations due to a ruling by the Federal Constitutional Court.
Source: www.ntv.de
