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Tuesday, March 28, 2023

Finances: Court of Auditors warns of loss of control over the federal budget

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Financial difficulties in the health sector, sharply increasing spending on defense – the wishes for the finance department are currently great. The Court of Auditors is concerned about the mountain of debt.

The Federal Court of Auditors has warned the federal government of a financial loss of control. The mountain of debt has now grown to 2.1 trillion euros. “This dynamic and its consequences threaten to seriously jeopardize the sustainability of federal finances and thus also the state’s ability to act,” said Court of Auditors President Kay Scheller on Wednesday.

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In order to keep the reins of action in hand, the federal government must reprioritize all expenditure and consistently align the budget with the core tasks. No new measures should be decided without clarifying their long-term financing.

Court of Auditors: Repay loans faster than planned

“Stable federal finances now require clear, intelligent and also painful decisions,” emphasized Scheller. Constantly evading new debts, ignoring reality and ignoring the interests of the younger generation in particular. Among other things, the Court of Auditors proposes that the loans taken out in the past three years be repaid faster than planned and that special funds be wound up. These credit-financed pots in addition to the regular budget circumvented the debt brake.

Scheller said the government and parliament now have the responsibility to weigh things up and resolve conflicts. “Instead of taking the easy route and pushing those decisions about debt into the future.” Because the sharply increased interest burden is currently encountering a huge need to modernize infrastructure, defence, digitization and climate protection as well as rising costs for social security.

Finance Minister Christian Lindner (FDP) is currently struggling with his departmental colleagues to draw up the federal budget for 2024. The spending requests of the ministries exceed Lindner’s plans by around 70 billion euros. The Greens have brought tax increases into play for financing, which the FDP strictly rejects. The cornerstones of the budget for the coming year are to be decided in the cabinet on March 15th.

Source: Stern

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