background
Social affairs, Bundeswehr, transport: The budget draft contains a few big chunks, but savings are made nonetheless. What the traffic light wants to spend money on – and where it is still arguing.
It is a huge sum: the federal government wants to spend 445.7 billion euros in the coming year. However, this is around 30 billion less than this year, when, as in previous years, there was a lot of crisis-related spending, mainly because of the corona pandemic and the energy crisis.
Finance Minister Christian Lindner now wants to switch to a strict austerity course. The debt brake should be adhered to. After long and difficult negotiations, the draft budget is to be approved by the cabinet on Wednesday and then go through to the parliamentary process. There are usually some significant changes there. The Bundestag is to adopt the budget in early December.
work and social affairs
As every year, by far the most money is moved in the budget of the Ministry of Labor and Social Affairs. Almost 172 billion euros are to be made available for this in 2024, after a good 166 billion this year. That’s more than a third of the entire budget.
For them alone pension insurance According to the draft, 127 billion euros in tax money will be made available, after 121 billion this year – the federal government pays subsidies to the pension fund and also takes over contributions for the time of raising children. “The subsidies, contributions and reimbursements are justified, among other things, by the fact that the statutory pension insurance takes on tasks for society as a whole,” says Hubertus Heil (SPD), head of the department at the Ministry of Labor.
For the citizen money 24.3 billion euros are planned in the social budget for next year, after 23.8 billion this year.
Family
The Family Ministry will have to make do with almost 218 million euros less in the coming year. The estimated total expenditure is around 13.5 billion euros.
The largest post in the ministry, the parental allowance. The wage replacement benefit that the state pays when parents stay at home after the birth of their children should no longer be paid to top earners, but only to parents who together earn no more than 150,000 euros a year. Previously, this limit was 300,000 euros. Expenditure on parental allowance has risen from 7.6 billion last year to 8.3 billion euros this year, and the cut is intended to save 290 million euros. There has been severe criticism of Minister Lisa Paus’s (Greens) plans for parental allowance.
Additional expenses will be charged for this child supplement scheduled to be given to low-income families. Here the costs will increase from 1.9 billion to an estimated 2.2 billion euros in the next year.
Basic child security
The cabinet also approves the financial plan up to 2027. This includes: the basic child security planned for 2025, which is intended to bundle various family benefits. Eligible families should be better reached and children and young people at risk of poverty better supported.
It is still controversial how much it should cost. Lindner initially set two billion euros in the financial plan for 2025 as a “placeholder”. From the point of view of the Greens, this is clearly not enough.
Education
The budget of Bettina Stark-Watzinger’s (FDP) Ministry of Education and Research will shrink from 21.5 billion euros in 2023 to 20.3 billion euros in the coming year. This has to do in large part with the fact that the 200 euro energy price flat ratewhich was launched once this year for students and technical students and has a total volume of 700 million euros, will be canceled next year.
But it will also range with less spending BAföG calculated: almost 1.4 billion euros for students are estimated, after 1.8 billion this year; 551 million for student BAföG after 763 million this year.
The education and science union criticized: The traffic light coalition is systematically starving out the BÀföG if they do not adjust the rates to the galloping inflation and price explosion on the housing market.
In the federal budget for 2024, EUR 500 million is a particularly important educational policy project, the so-called Starting Chances Program: With this, 4,000 schools nationwide “with a high proportion of socially disadvantaged students” are to be specifically promoted – with money, but also with additional social workers. It is scheduled to start in the 2024/2025 school year.
Health and care
After the end of the acute corona crisis, the budget of Health Minister Karl Lauterbach (SPD) is shrinking. Expenditure of 16.2 billion euros is still possible – 14.5 billion of this alone is already the usual subsidy to the statutory Health insurance bound.
As a savings contribution to the budget restructuring, a subsidy that was only introduced in 2022 is paid for the care insurance away from one billion euros. However, Lauterbach immediately made it clear that there would be no cuts in benefits as a result. Specifically, the sum should not flow into a care provision fund as a buffer for future times.
The background is also a reform that has just come into force, which is intended to mobilize 6.6 billion euros more for care every year – through higher contributions, which are due since July 1st. However, this should also finance relief for those in need of care in the home and at home from the beginning of 2024.
In the case of the SPD and the Greens, that was not enough for many. Without the prospect of more money from the budget, however, the chances of further improvements dwindle. And with the refusal to cut back on benefits, the next increases in contributions for care and for the statutory health insurance funds are becoming more likely.
defense
With an increase of 1.7 billion euros to around 51.8 billion euros, the defense budget stands out in the midst of the cuts. However, Minister Boris Pistorius (SPD) cannot be happy about a real increase for 2024, because the amount pretty much only covers the need because of tariff increases becomes necessary. In the meantime, more than ten billion more had been discussed for the Bundeswehr.
The promise of a fully equipped and operational Bundeswehr must now be financed all the more from the 100 billion pot that is available for major armaments projects such as the F-35 stealth jetmore modern armored personnel carrier or secure communication channels is planned, but does not cover ongoing maintenance.
In the coming year, 19.2 billion euros are to be invested from this special fund. For the first time, the government also wants to achieve the goal of NATO – two percent of gross domestic product for defense – fulfill.
rail
According to the draft, the focus of investments in the transport budget of Minister Volker Wissing (FDP) is on the rails – that rail network is partly dilapidated and should be renovated more quickly.
The heads of the coalition had determined at the end of March that the state-owned Deutsche Bahn would need around 45 billion euros to cover the investment needs by 2027. This need should be covered “as far as financially feasible”, essentially from income from the truck toll. However, the estimated 45 billion euros will not be reached, according to coalition circles. There was talk of up to 34 billion euros by 2027 – but that was significantly more than originally planned.
The federal government also wants to examine whether and to what extent the climate and transformation fund (KTF) – a special pot in addition to the budget – can make a contribution of 15 billion euros over the next two years to cover investment needs. Billions in government revenue from emissions trading and CO2 pricing flow into the fund.
However, numerous other projects are also financed from the KTF – for example, funding for the replacement of the heating system. Negotiations are still ongoing on the fund’s business plan.
The Greens expert Matthias Gastel said that the funding backlog at the railways had to be tackled even more actively. The railway industry association criticized the start for the rails. Significantly fewer investment funds were set aside for the modernization of the railways than the leaders of the coalition had agreed.
roads and bike lanes
For the federal trunk roads, that is Motorways and federal roads, around 12.8 billion euros are planned, slightly more than this year. Of this, around 11.5 billion are to go into the planning, construction, maintenance and operation of federal trunk roads.
The federal government wants around 263 million euros for the promotion of the bicycle and pedestrian traffic spend – around 150 million euros less than in 2023. There should be a reduction in the construction of cycle lanes, for example.
Reside
The social housing should be strengthened, 3.15 billion euros are planned and thus more than originally planned. There are also funds for urban development funding, for example.
regional business promotion
There had been a lot of excitement about possible cuts in regional economic development – especially in the east. The aim of the “joint task to improve the regional economic structure” is structurally weak regions to support and provide incentives to jobs to accomplish. Funds of 679 million euros are now planned for 2024, which is even 32 million more than in 2023. This will be achieved through reallocations.