Household - Debt brake: Two finance ministers call for reform commission
Baden-Württemberg's Finance Minister Daniel Bayaz (Greens) and Berlin's Finance Senator Stefan Evers (CDU) have called for a reform commission for the debt brake. This should be made up of representatives from the federal and state governments and academia in order to further develop the debt brake, write the two politicians in a guest article published in the "Tagesspiegel" on Friday.
The two state politicians consider an investment rule as part of the debt brake to be a conceivable part of a possible reform. "This would enable the credit financing of additional investments, for example with a view to the challenges of transformation," they say in the guest article. "A new exception to the debt rule must not lead to new leeway being created for consumptive or non-targeted expenditure by politically charging the concept of investment."
The federal states also need more scope for debt. "A debt level for the federal states of 0.15 percent of their GDP, for example, would open up leeway that could be used for the most important federal state policy issue of education," write the two politicians. They believe that emergency loans should also be able to be used beyond the year in which the emergency begins.
The debt brake is being criticized following the budget chaos at federal level. There is talk among the federal states of launching a reform initiative in the Bundesrat, as Berlin's governing mayor Kai Wegner (CDU) said on RBB-Inforadio on Friday.
"In Germany, more experts are concerned with the question of how to circumvent the debt brake in accordance with the constitution rather than how to generate higher taxes through higher economic output," said Bavaria's Finance Minister Albert Füracker (CSU), countering the initiative of his counterparts from Berlin and Stuttgart. "We need to boost the economy, promote growth, then tax revenues will rise again and with them the scope for action," said the CSU politician.
Guest article in the Tagesspiegel
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- Stefan Evers, the CDU Finance Senator in Berlin, agrees with Baden-Württemberg's Finance Minister Daniel Bayaz (Greens) on the need for a reform commission to further develop the debt brake, as stated in their guest article published in the "Tagesspiegel."
- In their guest article, Evers and Bayaz propose an investment rule as part of the debt brake, which could enable credit financing for additional investments while preventing misuse for non-targeted expenditure.
- The two politicians argue that Germany's federal states require more scope for debt, suggesting a debt level of 0.15% of their GDP for the federal states, which could be utilized for important policy issues like education.
- Following the budget chaos at the federal level, Berlin's governing mayor Kai Wegner (CDU) suggests launching a reform initiative in the Bundesrat, indicating possible discontent with the current debt brake system among the federal states.
- Bavaria's Finance Minister Albert Füracker (CSU) countered the initiative of his colleagues from Berlin and Stuttgart, emphasizing the importance of boosting the economy and promoting growth to increase tax revenues, rather than focusing on circumventing the debt brake constitutionally.
Source: www.stern.de
