In his government statement, Chancellor Scholz emphasized that Germany was facing challenges that it had probably never experienced before in this level of hardship. He also announced that the energy price brakes would end at the beginning of the year.
Chancellor Olaf Scholz has admitted that the Karlsruhe ruling makes the work of his traffic light coalition much more difficult. “This ruling creates a new reality – for the federal government and for all current and future governments, at the federal and state levels. A reality that, however, makes it more difficult to achieve important and widely shared goals for our country,” said the SPD politician in a government statement in the Bundestag. Germany is facing “challenges that our republic has probably never experienced before in this concentration and severity.”
The discussions about the consequences of the judgment have not yet been completed. But it is clear: “With the knowledge of the current decision, we would have taken other paths in winter 2021 – paths that the court also pointed out in its judgment.”
Energy price brakes will be completed at the beginning of the year
Scholz also announced an end to the electricity and gas price brakes at the beginning of next year. This is possible because electricity and gas tariffs are again available across Germany that are below the upper limits of the price brakes, he said.
In addition, the gas storage facilities are “so well filled that we do not expect sudden price jumps.” The price brakes were actually supposed to apply until the end of March.
“The state will continue to fulfill its tasks”
At the same time, Scholz assured reliable state services despite the budget crisis. Current expenses are not affected, said the SPD politician. “The state will continue to fulfill its duties.”
He also said this to citizens who are unsettled by some wild suggestions and targeted false reports. “The ruling of the Federal Constitutional Court does not change anything in your everyday life here and today – regardless of whether you receive child benefit or student loan, a pension or housing benefit.”
Judgment of Federal Constitutional Court
The Federal Constitutional Court had declared the reallocation of 60 billion euros in the 2021 budget to be null and void. The money was approved as a Corona loan, but was subsequently intended to be used for climate protection and the modernization of the economy.
At the same time, the judges decided that the state was not allowed to reserve emergency loans for later years. The federal government had done this in several special funds, including for energy price brakes.