The Grand Coalition is satisfied with the federal budget for 2020, and points to its core pillars: no new goverment debt, investments at record levels and more money for climate protection. The opposition, however, criticises the draft as “not fit for the future”.
According to Finance Minister Olaf Scholz (SPD), the Grand Coalition is meeting important challenges such as the fight against climate change with the 2020 federal budget. Scholz told the Bundestag that the federal government was increasing investments, for example, for more climate protection, spending more money on social programmes and reducing tax burdens. “I think that’s a good achievement.”
The draft would introduce a climate-friendly “U-turn in financial and economic policy”. The Finance Minister said that the draft would “set the course for the next decades”. It is aimed at enabling Germany to be climate-neutral in 2050 while still being “economically at the top”.
Scholz said that the government was strengthening the railways, promoting technological change in the automobile industry, investing in the expansion of daycare centers and better equipment for schools. He also reaffirmed his initiative to help heavily indebted municipalities financially so that they can invest again.
Substantial increases on all fronts
Scholz protested against the opposition’s criticism that his budget was unsoundly financed and that it did not invest enough in areas of the future. He accused the critics of “messing everything up”. His view of the 2020 budget is a different one: It contained a “substantial increase over the previous budget”, a “substantial increase in investments”, a “substantial reduction in the tax burden on citizens” and an “improvement in social support”.
Taken together, the draft would reduce the burden on citizens by 25 billion euros a year, he said, mentioning the planned partial abolition of the solidarity surcharge and the reduction of the sly progressive taxation.
FDP criticises lack of investment
The opposition, on the other hand, accused the coalition of an unsound budgetary policy. Otto Fricke of the FDP criticized the lack of investment in central areas: The Digital Fund was underfinanced, and the increase in the education budget “did not even cover the inflation compensation”. The draft budget for 2020 is “no longer even a ‘continue like this’ – these are huge steps backwards”, criticised Fricke. “We won’t be able to build a future with such a budget.”
The Liberal Democrat accused the CDU/CSU of yielding too much to the expenditure demands of the weakened SPD. With a view to the Social Democrats he said: “This is not about bringing Germany forward, but about maintaining a party so that the grand coalition can continue to muddle through”. The balanced budget was not actually sustainable – the coalition had only been able to prevent new debt by acessing billions from the so-called asylum reserves, Fricke said.
AfD: “Spending at the expense of future generations”
The AfD politician Peter Boehringer also accused the government of running its business at the expense of future generations. The coalition profited above all from the low interest rates charged by the European Central Bank. A balanced budget is still possible until the 2021 federal elections, but after that the government will leave “super-empty coffers”, he said. Until then, the reserves would be “almost completely used up”.
Boehringer also took the government’s economic policy to court sharply. According to him, the governemnt is “led by ideology to damage key industries”. “This will cause a disaster on the job market and in the budget.
The Greens criticized the expenditures for climate protection as too low. Budgetary politician Anja Hajduk spoke of a “tiny climate package”. The Grand Coalition’s climate plans are “too small, socially unbalanced” and “hardly effective”. Education, climate and the digital economy need “a completely different volume and a completely different impetus”.
Coalition politicians see solid foundation
Coalition politicians defended the budget against opposition criticism. The CDU budget politician Eckhardt Rehberg said at the beginning of the budget week in the Bundestag that the budget was a good foundation for the coming year and the coming years. The coalition is advancing climate protection, investments are at record levels, and internal security is being strengthened.
SPD budget member Johannes Kahrs also emphasized that the coalition would ensure that more investments would be made in Germany. The climate protection program is socially just and economically reasonable.
In total, the Federal Government’s proposal for 2020, as amended by the Budget Committee, provides for expenditures of 362 billion euros – 5.6 billion euros more than in the current year. The final vote on the draft budget is scheduled for Friday.