The traffic light coalition is wrestling with how much money the federal government can spend on in the coming year. This will soon come to an end. In any case, the FDP rejects a tax increase in the budget crisis.
In the budget crisis, SPD leader Saskia Esken expects that the federal budget for 2024 can be finalized this year. At the same time, she spoke out against cuts in social benefits and cuts in climate protection.
Esken told the Düsseldorf “Rheinische Post”: “We are determined and confident that we will finalize the budget for 2024 in the old year. The people in Germany, on whose shoulders the crises are piling up, deserve their Christmas rest and need clarity about what will happen next .” But this will only succeed if all coalition partners recognize the reality and approach each other now, warned Esken.
“We will find potential for savings, but here we should focus on the strong shoulders and not pensioners, children or the unemployed,” said the SPD leader. At the same time, she indicated that she would not accept any cuts in plans for the climate-friendly transformation of the economy. “We will continue on our path to climate neutrality and will not leave people and the economy alone.”
FDP rejects tax increases
The FDP also wants cuts in social spending. In the budget crisis, however, she rejects tax increases. The deputy FDP chairman Johannes Vogel told the German Press Agency: “Tax increases are not only rightly excluded in the coalition agreement, they would also be exactly wrong for our competitiveness – because Germany is already a high-tax country. Instead, we need the middle class and companies to do so as agreed relieve more pressure.”
After the Karlsruhe budget verdict, SPD leader Lars Klingbeil questioned agreements made in the coalition agreement. The waiver of tax increases advocated by the SPD, Greens and FDP is under review, said Klingbeil.
The traffic light coalition is wrestling with how much money the federal government can spend on in the coming year. The Karlsruhe ruling has left billions in gaps in both the 2024 budget and a fund for modernizing the economy and climate protection.
Debt brake issue
Vogel, First Parliamentary Managing Director of the FDP parliamentary group, also spoke out against suspending the debt brake again next year due to an emergency – as many in the SPD are calling for. Vogel said that this does not appear to be legally possible, at least according to the Federal Constitutional Court’s statements.
“But it would also be politically wrong – just like a fundamental weakening of the debt brake, as the majority of the Union Prime Ministers want. The debt brake has just been strengthened by the ruling from Karlsruhe.” Weakening the debt brake or increasing taxes in response to the ruling is out of the question for the Free Democrats.
Vogel emphasized: “The state does not have a revenue problem, but it must now prioritize more clearly, realize the need for reform and use the resources at its disposal accurately. We must and can save money and make more effective policies with less money.”
Schulze contradicts Lindner – development aid is good
Federal Development Minister Svenja Schulze warned Finance Minister Christian Linder (FDP) against cuts in development aid. “An economy that relies on international value chains and global problem solutions cannot afford a shell mentality,” the SPD politician told the newspapers of the Funke media group.
“Development cooperation is not a nice-to-have, but rather in our German interest,” she emphasized. A withdrawal would clearly be the wrong approach for a strong industrial country like Germany. “The problems would still come to us because they can only be solved globally,” warned Schulze.
In a Funke interview, Lindner had previously mentioned social areas as areas of savings, including citizens’ money, international financial aid and unspecified funding programs in order to close gaps in the budget for 2024. Germany is at the forefront when it comes to development cooperation and international climate protection financing, argued the FDP leader.
Calls for a stop to Citizens’ Money Plus
With regard to citizens’ money, the FDP leader pointed out in the newspapers of the Funke media group that the inflation rate is developing significantly better than predicted when the standard rate was set for 2024.
However, the sharp increase in citizens’ money at the beginning of 2024 is also causing discord in the Union. The social wing is resisting demands from the party leadership to stop the increase. CSU boss Markus Söder and leading FDP politicians, however, are calling for the increase to be reduced by twelve percent.
The more than five million citizens’ benefit recipients should receive an average of around 12 percent more money on January 1, 2024 – single people will then receive 563 euros. In contrast to previous adjustments, the sharply increased inflation for months was taken into greater account in the calculation for 2024 due to a change in the rules.