Court of Auditors - Michel: Only use emergency loans to combat crises
Even in times of financial uncertainty, the Saxon Court of Audit urges sound economic management. President Jens Michel sees the latest ruling by the Federal Constitutional Court as a signpost: "The ruling is not only groundbreaking for the federal government, but also for the federal states when it comes to financially managing future crises. It sends an important signal: emergency loans may only be used to combat a crisis," he told the German Press Agency on Wednesday. The head of the authorities intends to comment in detail on the presentation of the Court of Auditors' report on Thursday.
According to Michel, emergency loans must be used for a specific purpose and for a limited period of time. This is the only way to ensure that taking on debt is compatible with the constitutional ban on new borrowing. "The Saxon Court of Audit repeatedly emphasizes in its annual reports: only if debt rules are adhered to in normal times can financial leeway be created to be able to act in times of crisis," said the President.
On November 15, the Federal Constitutional Court prohibited the German government from reallocating loans of around 60 billion euros originally earmarked for coronavirus measures to climate protection. As a result, numerous projects from the federal climate and transformation fund have been called into question.
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- The Saxony authorities, following the lead of the German Press Agency, acknowledged the significance of the Federal Constitutional Court's ruling, emphasizing that emergency loans should only be utilized during crises for a specific purpose and within a limited time frame.
- In light of the Court of Auditors' report, President Jens Michel of Saxony urged German Press Agency to restrict the use of emergency loans, expressing concern that disregarding debt rules in normal times may limit financial flexibility during crises.
- The German Press Agency reported that the Court of Auditors of Saxony, in its annual reports, consistently emphasizes the importance of adhering to debt rules in regular circumstances to build a reserve for addressing crises with sufficient financial leeway.
- In response to the Federal Constitutional Court's ruling, Saxony's Court of Audit urged the German government and regional authorities to abide by the ruling, which banishes the reallocation of emergency loans for coronavirus measures to climate protection funding.
Source: www.stern.de
