Press
Once again, there were marathon negotiations that lasted until the early hours of the morning. But now an agreement has been reached. The FDP has been able to prevail on an important point.
Berlin – After long negotiations, the leaders of the traffic light coalition have achieved a breakthrough on the 2025 federal budget and the growth package. The German Press Agency learned this from coalition circles after consultations between Chancellor Olaf Scholz (SPD), Finance Minister Christian Lindner (FDP) and Economics Minister Robert Habeck (Greens).
The agreement on the federal budget for 2025 and the financial plan until 2028 stipulates that the debt brake will be adhered to, as the German Press Agency learned from government circles. An emergency situation was therefore not identified.
Scholz, Habeck and Lindner met in the afternoon. Nothing was initially known about the details of the agreement. The SPD and Green parliamentary groups will meet at 7 a.m.
Coalition leaders under budgetary stress
Scholz, Habeck and Lindner have negotiated frequently in recent weeks. They actually wanted to reach an agreement by this Wednesday. Now July 17 is being discussed for the cabinet decision. In order to reach this date, an agreement in principle was necessary soon, because the drafting of the budget law usually takes about ten days. From mid-September, the Bundestag will then deal with the draft budget, which could then be passed in November or December.
Billion dollar gap
Individual departments such as the Foreign Office or the Development Ministry initially did not want to accept Lindner’s austerity measures in view of international obligations. The social budget was also controversial. In addition, there was still a gap of around 10 billion euros that needed to be closed. The SPD in particular, in view of the financial burdens caused by the war in Ukraine, pushed for the debt brake to be suspended again in order to have more room for investment. This was out of the question for Lindner’s FDP. The SPD rejected cuts in the social budget.
Growth package
Only minimal growth is expected in Germany this year. Companies are holding back on investments, and private consumption is not picking up either. Business associations have long complained about disadvantages of the location, such as high taxes and duties, a lack of skilled workers and too much bureaucracy.
This is where the government wants to start with the “growth boost”. Scholz had already said that the federal government wanted to promote private investment. He promised improved tax depreciation for companies. In addition, it should be easier for parents to work and work incentives should be increased, including through taxation. dpa
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