Status: 07/28/2021 3:53 p.m.
The financial aid against the consequences of the corona pandemic is clearly noticeable on the public budget’s debt clock. At the end of 2020, these amounted to the record value of 2172.9 billion euros.
The immense expenditure to mitigate the consequences of the corona pandemic has caused public debt in Germany to rise to a record level.
At the end of 2020, the debts of the general public budget in the non-public area to 2172.9 billion euros, as announced by the Federal Statistical Office. This sum summarizes all debts that the federal government, states, municipalities, community associations and social security have in the non-public sector, for example with private banks or companies in Germany and abroad.
Highest value within a year
Within a year, the debt grew by 14.4 percent or 273.8 billion euros – the highest value ever recorded in the statistics at the end of a year. This corresponds to a debt of 26,141 euros per capita. For comparison: At the end of 2019, the debt amount per capita was still 22,860 euros.
The Federal Statistical Office justifies the increase in debt primarily with the measures taken against the economic consequences of the corona pandemic. These include the financial aid packages for companies or the self-employed as well as, for example, the reduction in VAT.
Federal debt increased by 18.1 percent
According to the final figures, the federal government was in debt with 1403.5 billion euros at the end of last year, which corresponds to an increase of 18.1 percent within a year.
The increase in the federal states and municipalities was much lower: the federal states’ indebtedness rose by 9.8 percent to 636 billion euros.
Highest per capita debt in the city-states
The city-states had the highest indebtedness per inhabitant. In first place was Bremen with a debt of 57,823 euros per capita, followed by Hamburg with 19,181 euros and Berlin with 16,307 euros. However, unlike the territorial states, the city-states must also perform municipal tasks.
Of the other federal states, Saarland had the highest debt per inhabitant at 14,737 euros. Schleswig-Holstein came in second with 11,002 euros. According to statistics, Bavaria had the lowest per capita debt with EUR 1359 and Saxony with EUR 1244.
The debt of the municipalities and municipal associations increased by only 1.5 percent. Their debts were at € 133.3 billion at the end of 2020. Social security debts fell to 44 million euros.
FDP parliamentary deputy warns of higher inflation
Christian Dürr, deputy chairman of the FDP parliamentary group, was alarmed by the sharp rise in debt. “If the state becomes more and more indebted, it can lead to higher inflation,” he warned the AFP news agency. The aim of the next federal government must therefore be “to put state finances back on a solid footing”.
The scientific director of the Institute for Macroeconomics and Business Cycle Research (IMK) of the Hans-Böckler-Foundation, Sebastian Dullien, sees in the “massive” appearing plus of the debt nevertheless “economically no cause for concern”. The debt ratio, ie the ratio of debt to annual economic output, is still “significantly lower than after the financial crisis in 2012 and is likely to decrease rapidly from 2022”.