breaking news
The traffic light coalition does not want to suspend the debt brake in the 2024 budget. But there will be cuts and savings. Chancellor Scholz said this in a press conference on the agreement in the budget dispute.
The traffic light government wants to comply with the debt brake in the Basic Law again next year. Federal Chancellor Olaf Scholz announced this regarding the agreement on the 2024 budget.
There will be cuts and savings in order to implement the budget ruling of the Federal Constitutional Court. “We don’t like doing them, of course, but they are necessary so that we can get there with the money we have available,” said Scholz in Berlin. Some climate-damaging subsidies would be abolished, expenditure by individual departments would be reduced and federal subsidies would be reduced. The CO2 price for refueling and heating with fossil fuels is to be increased.
Three central goals
The Chancellor emphasized that the federal government is sticking to its three central goals: “We are vigorously pushing forward the climate-neutral transformation of our country. We are strengthening social cohesion. And we are close to Ukraine in its defense fight against Russia.” These three goals continued to guide the federal government. “But one thing is clear: we have to get by with significantly less money to achieve these goals.”
According to Scholz, however, the government reserves the right to subsequently suspend the debt rules if necessary if Ukraine’s military or financial situation worsens in the war against Russia.
Cuts in climate and Transformation Fund
The Climate and Transformation Fund (KTF) should remain the central instrument of climate-friendly restructuring. However, the fund will be reduced by twelve billion euros for the coming year, said Scholz. By 2027, the cuts would amount to 45 billion euros. The total volume of the fund will then be around 160 billion euros.
In order to secure industry support for the climate-friendly conversion, the traffic light wants to save on the electric car purchase premium, among other things. The bonus will expire earlier than planned, said Vice Chancellor Robert Habeck without giving a date. In addition, solar funding will be reduced.
No savings on the railway
There will also be changes in how Deutsche Bahn supports the renovation of the rail network. Finance Minister Christian Lindner added that the railway should benefit from privatization proceeds. The railway wants to sell its daughter Schenker. According to Habeck, there should be no savings on the railway. The state-owned company should be financed differently than previously planned. There will be reallocations in the climate fund.
The cabinet should now approve the traffic light government’s fundamental agreement on the 2024 budget as quickly as possible, said Scholz.
More information coming soon.