Government formation: struggle for distribution of the billions and reforms begins

After the Union and SPD’s agreement with the Greens via the planned multi -illium financial package, the struggle for the specific distribution of the additional funds begins. The economy and economists – like the Union – also penetrate reforms and reduction in bureaucracy in order to achieve an effect with the additional debt admission and to overcome the economic weakness.

New draft for the change of Basic Law

First, however, the Bundestag’s budget committee is to deal with the new bill on Sunday. According to information from the German Press Agency, this now stipulates that the words “climate neutrality” will be included in the new Article 143h of the Basic Law by 2045.

It is also stated that the investments from the debt -financed, 500 billion euros in special funds are intended for additional investments. “Additionality exists if an appropriate investment rate in the federal budget is reached in the respective financial year,” says the draft.

In addition, it is stated that the planned loosening of the debt brake not only applies to defense spending, but also for federal expenditure for civil and population protection, the intelligence services, cyber security and the help of states that are contrary to international law.

Eyes on coalition negotiations

The CDU, CSU and SPD must now negotiate exactly what should be financed with the additional billions. First, however, all eyes depend on the coalition negotiations. By March 24, the working groups should develop suggestions for the coalition agreement. Pflucks are also likely to be hit for the use of the new billion dollar loans. Who wants what?

It penetrates structural reforms and savings. “Investing, we can do this with this special fund. But reforming and consolidating the task, which is still ahead of us,” said the head of the CSU members of the Bundestag Alexander Dobrindt in the ARD “daily topics”. This is the task for the working groups in the coalition negotiations. “It also has to be saved clearly and our country is made fitter.” The SPD, for example, knows that savings had to be made in the case of citizenship. Similarly, the CDU general secretary Carsten Linnemann had already said shortly before the agreement.

In the future, they should be able to take out loans of 0.35 percent of gross domestic product (GDP). In addition, they should receive 100 billion euros from the planned 500 billion special assets for infrastructure investments.

Thuringia’s Prime Minister Mario Voigt (CDU) proposes the so -called Königstein key, which depends on tax revenue and population of the federal states. “It takes a slim, simple process that is characterized by trust in the federal states and municipalities,” he told the Editorial Network Germany.

The federal states also have a say in the planned changes to the Basic Law: After a farewell next Tuesday in the Bundestag, a two -thirds majority is also required in the country chamber.

The city and municipal association expects the federal states to pass on a large part of the additional funds to the municipalities. “Cities and municipalities know very precisely which infrastructure measures have to be prioritized for roads, schools, bridges or other areas,” said managing director André Berghegger to the editorial network Germany.

The President of the District Council, Achim Brötel (Neckar-Odenwald-Kreis, CDU), called for a tripling of the municipal sales tax share in the newspapers of the Funke media group. “This could make the counties, cities and municipalities a lot more than with a large investment program in which the federal government sets up the conditions and that may not even be the most pressing municipal needs,” he said.

The German Chamber of Commerce and Industry warned that the economy remains weak without consistent reforms, and the additional loans could storm to an enormous burden. Faster planning and approval procedures are necessary. Veronika Grimm from the Council of Experts for Economy (“Economic”) told the “Welt”: “The negotiating partners are now under great pressure to decide on growth -promoting structural reforms.” The prerequisites for this are not a good thing if you can mate everything with money.

The DGB chairman Yasmin Fahimi praised the agreement. “The possible coalitioners now have to make a convincing program for safe employment and sustainable economy.

In addition to the loosening of the debt brake for the countries, this:

Defense, civil defense, cyber security and intelligence services: expenditure for this should only fall under the debt brake up to one percent of one percent of GDP – around 44 billion euros. Everything beyond that should be financed as desired from credit. Investments in infrastructure and climate neutrality: A special fund that is not subject to debt brake is to be fed with 500 billion euros from loans. The special pot should be available for twelve years.

The budget committee meets on Sunday and gives a recommendation for the Bundestag. The plenary should decide on Tuesday. The Bundesrat will meet the project. March 24th, the working groups of the coalition negotiations should submit their text proposals for the coalition agreement, after which the smaller steering group deals with it. The latest date, until the Union Chancellor candidate Friedrich Merz (CDU), wants to have formed a government.