After long discussions and the latest modifications, the German Parliament took the final step this Friday to approve, at the end of November, the largest Budget this country has ever had. The public accounts supported by the parliamentary Budget Committee contemplate an expenditure of 560.9 billion euros.
Likewise, they foresee a net debt of almost 123,000 million euros, which is about 4,000 million euros more than what had been anticipated in the first draft of the German Government. Added to this debt are investments financed with credits from special funds for infrastructure and the Armed Forces, bringing the total debt to more than 200 billion euros. It is the second largest debt in the history of the Federal Republic.
The German government will thus be able to spend more money than ever next year. However, it remains unclear whether the coalition of conservatives and social democrats will be able to finance an electricity tax reduction for all as German Chancellor Friedrich Merz intends. This measure could still be presented during the budget week in the German Parliament at the end of November, where the budget approved by the commission will be definitively voted on this Friday. In the budget negotiations held so far, the conservatives and the SPD have not found funding for this. According to calculations, the project, included in the government coalition agreement, would cost about 5 billion euros, while for citizens it would mean a saving of only a few euros.
The draft budget was approved after a marathon session of almost 16 hours by the commission with the majority of the parliamentary groups of the CDU/CSU and SPD coalition, compared to the votes against the opposition groups Alternative for Germany (AfD), the Greens and Die Linke (The Left). Compared to the forecast for 2026 (524.54 billion euros), expenses increase by 6.9%. Meanwhile, the net debt stands at almost 123,000 million euros within the ordinary basic budget, compared to 98,000 million euros in 2026. To this must be added the debt derived from the exceptions to the debt brake for Defense and the debt of the so-called special funds destined for infrastructure and climate neutrality, as well as for the Armed Forces. In total, the Government plans to contract more than 210,000 million euros of new debt in 2027. Only in the year of the covid pandemic, in 2021, the figure was higher, with 215,400 million euros.
The largest item continues to be that of the Ministry of Labor and Social Affairs, which exceeds 200,000 million euros for the first time. It rises from 197.3 billion to 203.3 billion euros in 2027. Cuts are expected in the basic subsistence benefit for job seekers. The Defense budget goes from 82.7 billion euros in 2026 to 109.7 billion euros in 2027. In this way, almost 20% of the total budget is allocated to the Armed Forces. To this must be added the expenses of the Bundeswehr special fund. In total, 140,000 million euros will be allocated.
“This is a colossal effort,” acknowledged the SPD budget spokesman, Thorsten Rudolph, in the subsequent press conference in which he also stressed that a budget deficit of 34 billion euros has been covered. "We have a responsibility, both towards Germany and towards Europe, to provide ourselves with conventional defense capacity and to exert a deterrent effect. Therefore, these expenses, however high they may be, and the debt that we must contract for this task are, in fact, something for which there is no alternative," he added, aware that it is an issue that arouses criticism from a part of the German electorate that accuses the Government of cutting back on social benefits to spend more on Defense. They also criticize the high debt that will burden future generations.
"We clearly allocate more than half of the debt we contract to the field of security and defense. And in this sense it applies that, without freedom, everything is in vain. If we want to defend our freedom, these expenses are necessary in the current geopolitical situation," justified Rudolph, who recalled that another part of the debt is for roads and railways, digitalization, construction and housing. "We will allocate 11.3 billion euros for roads, 21,800 for railways and 1,700 for waterways. These are considerable sums," declared the conservatives' budget spokesman, Christian Haase.
The opposition harshly criticized these plans. The budget manager of the Greens parliamentary group, Sebastian Schäfer, described the budget as a “wooden hut without foundations”, in statements to the DPA agency. “This budget makes your blood run cold,” said Die Linke budget manager Dietmar Bartsch, adding that it includes a record debt based on the principle of “after us, the flood.”
