Even before the end of the parliamentary summer recess, the traffic light slipped into its next coalition crisis. On Wednesday, Federal Family Minister Lisa Paus (Greens) prevented the cabinet from approving a law by Finance Minister and FDP leader Christian Lindner with a “leadership reservation” with which he wants to strengthen the ailing economy. With its blockade of the “Growth Opportunities Act”, which provides relief of almost six billion euros for companies, it is said that it wants to force concessions on basic child security.
“Germany needs growth again,” said Lindner after the cabinet meeting. The structural conditions for the economy would have to be improved and investments made more attractive. It is therefore “regrettable” that the cabinet decision was not possible, despite the agreement with the Green Federal Ministry of Economics. In fact, according to reports, there had previously been an agreement with the Chancellery and Economics Minister Robert Habeck (Greens). He had negotiated changes to the law – including degressive depreciation for movable assets. Because the SPD and Greens also had reservations about some of Lindner’s particularly far-reaching relief proposals, the finance department softened the original plans on these points.
Lindner is planning two billion euros for basic child security. Paus wants more
The fact that Paus has now stopped the project – despite the approval of the Green Vice Chancellor and extensive last-minute negotiations at the highest government level – also shows that there are evident differences within the Greens over the course of economic policy. From circles of the Ministry of Finance it was said on Wednesday that “irrelevant reasons” had led to the management reservation, i.e. the link to basic child security. Before the summer break, Chancellor Olaf Scholz (SPD) had decreed that Paus should submit a draft law by the end of August – with different variants as far as the design is concerned.
So far, Lindner has estimated two billion euros a year for basic child security in the financial plan. Paus still wants significantly more money for her most important project. But Lindner demands counter-financing for everything that goes beyond the priced two billion. “Everyone should know that all social spending needs a strong economic foundation,” he said on Wednesday, referring to the averted cabinet decision. However, Paus defended herself against the accusation that she was blocking the Growth Opportunities Act in order to force Lindner to make concessions on basic child security. “I don’t believe in playing off economic support measures or higher defense spending against more funds for families threatened by poverty,” said Paus World.
At the heart of the Growth Opportunities Act are bonuses for companies that invest in climate-friendly technologies and production methods. There are also various tax breaks, such as better offsetting of profits against losses and more generous research funding. The law should now instead be passed at the end of August at the cabinet meeting in Meseberg, according to finance ministry circles. In particular, the Green coalition partners were asked to “clarify their internal priorities” by then and then to introduce a common Green position. Scholz was also optimistic on Wednesday that the coalition would launch the Growth Opportunities Act “this month”.
Despite the blockade by Paus, those around the Ministry of Finance are not assuming that Meseberg will have to cut back on the draft. At most, an expansion of the package is conceivable, for example with an expansion of the investment premium to areas beyond climate investments and greater support for housing construction.
While the Growth Opportunities Act did not make it onto the cabinet agenda on Wednesday, a number of other traffic light projects were passed, including some laws from Lindner: The “Future Financing Act”, for example, is intended to improve the conditions for start-ups in Germany; the “Household Financing Act” in turn bundles the necessary legislative changes for a debt brake-compliant budget for 2024. These include, for example, increasing the national CO₂ price, lowering the income limit for parental allowance or a lower tax subsidy for pension insurance.
The cabinet made another far-reaching change to this package at short notice: Originally, at the request of the Ministry of Defense, the draft had provided for a regulation with which the government would have committed itself much more strictly than before to the NATO target of two percent of economic output annually for defense to spend This wording has now been deleted. It therefore remains the case that the NATO target should only be achieved over a multi-year average of no more than five years.