State parliament adopts 2024/25 budget after controversial debate

Savings - State parliament adopts 2024/25 budget after controversial debate

Despite the tense financial situation and weak economy, Mecklenburg-Vorpommern is planning record spending of more than 11 billion euros for each of the next two years. The state will not incur any new debt, but will have to dig deep into its reserves to finance this. After a controversial debate about priorities and possible reallocation of funds, the state parliament passed the state's double budget on Wednesday with the votes of the SPD and Left Party coalition groups.

The budget comprises almost 11.4 billion euros for 2024 and 11.6 billion euros for 2025. According to the Ministry of Finance, there had only been higher expenditure in 2020, when the state took on debt again for the first time since 2006 in a supplementary budget to deal with the coronavirus crisis. The opposition, whose amendments met with only lukewarm approval from the coalition, voted unanimously against the financial plan. Speakers criticized the budget for being too unambitious and for not responding sufficiently to current challenges such as digitalization and the energy transition.

The coalition, on the other hand, praised the figures as proof of a solid financial policy aimed at security and economic progress. "The double budget stands for an economically strong, socially just and at the same time innovative and sustainable country," explained SPD MP Tilo Gundlack.

At the beginning of the debate, which lasted around ten hours, Education Minister Simone Oldenburg (Left Party) called for broad support for the double budget on behalf of the state government. She rejected the CDU opposition's proposal to postpone the vote on the budget to the beginning of 2024 until the expected federal funding had been clarified. If the budget was not passed as planned, important projects would not be able to start in the new year. As examples, Oldenburg cited investments in school construction, relieving prospective nursing staff of school fees and additional funding for fire departments and tourism.

Personnel expenditure will rise to record levels, to 2.7 billion euros in 2024 and 2.9 billion euros in the following year. With a recent share of 22 percent of total expenditure, Mecklenburg-Vorpommern is in a good position compared to other federal states, said Finance Minister Heiko Geue (SPD). However, the budget share will rise to 25 percent in the north-east by 2025.

"The federal government is in a budget crisis. Mecklenburg-Vorpommern is not. We remain capable of acting," emphasized Oldenburg, who spoke on behalf of Minister President Manuela Schwesig (SPD), who was ill. With the double budget, the coalition continues to ensure high levels of investment, totaling 3.3 billion euros in both years. One focus is the promotion of economic development. Around 800 million euros have been earmarked for future projects such as hydrogen technology. Additional funds have also been earmarked for the expansion of infrastructure, education and childcare as well as strengthening social cohesion.

The state is expecting grants of 700 million euros from the federal government for the coming years. However, the payments are still uncertain due to the federal government's precarious budget situation. It was only after a tough struggle that the leaders of the traffic light coalition reached an agreement on the federal budget for 2024 in Berlin on Wednesday. Following the budget ruling by the Federal Constitutional Court, the federal government was forced to make cuts and savings, which will also affect the federal states.

The many amendments to the state government's draft budget made it clear that the government plans had considerable deficits, said AfD parliamentary group leader Nikolaus Kramer. He also lamented what he considered to be excessive expenditure on refugees. He accused the government of neglecting the interests of the German population. "We are not willing to sacrifice the interests of the German people for the all-round carefree provision of every asylum seeker and the profit motive of the asylum industry," said Kramer.

Green parliamentary group leader Harald Terpe accused Kramer of using the language of "criminals", "who have destroyed the homeland in Germany and the world". This was unacceptable. On behalf of his party, he called on the state government to provide more funds for accelerating the energy transition and climate protection. However, the motion to provide 13.5 million euros annually for 180 additional energy consultants in the municipalities did not receive a majority.

CDU parliamentary group leader Franz-Robert Liskow accused the coalition of missing the opportunity to realign the state budget in line with the times. "Important future topics such as digitalization and artificial intelligence are being ignored," he said. In addition, the red-red government was violating the requirements of the Federal Constitutional Court by holding on to the 400 million euro special fund for the university hospitals, which is fed by the Corona Protection Fund. He clearly rejected the coalition partners' proposal to reform the debt brake: "They say reform. They mean abolish."

According to FDP parliamentary group leader René Domke, the coalition's budget lacks a plan to put the state on a stable long-term footing. "There is no sign of intergenerational fairness, foresight or predictability. There is no sign of courage when it comes to reducing bureaucracy, digitalization and personnel," he stated. The state is facing hard times and the state budget does not provide any answers to the pressing issues. Domke lamented the fact that none of the more than 100 amendments proposed by his parliamentary group had been adopted.

Timetable for the state parliament session with links to laws and motions Medium-term financial planning with tables