German Finance Minister Lars Klingbeil is pushing through a draft federal budget for 2027 that envisions expenditures of 555.4 billion euros and net new borrowing of 118.7 billion euros. At the same time, the Union-SPD government is reckoning with significantly higher debt, primarily for defense, and with austerity measures in other areas. Spiegel.de ↗
New articles add that the cabinet approved the budget draft with roughly 200 billion euros in debt, and that in putting it together, Klingbeil is also resorting to contentious maneuvers, including tapping the climate and transformation fund. Criticism is coming from both the opposition and associations, who are attacking the combination of record debt, cuts, and higher taxes. The planned tax increase on spirits and sparkling wine is meant to bring in additional revenue, but alcohol producers doubt the government's estimates. n-tv ↗
Tension also continues in healthcare. Health Minister Nina Warken is preparing savings in psychotherapy, which policy experts from the Union and SPD factions have opposed. The coalition had already previously announced adjustments to the statutory health insurance package, meant to ease part of the burden on the insured. Tagesspiegel ↗
Another dispute concerns heating and climate policy. Despite earlier promises, the government is reducing support for heat pumps, and the adoption of the successor law to Habeck's heating law is being postponed. In addition, the expert commission failed to agree on a unified reform of the debt brake, and Klingbeil is set to receive three different proposals. Developments will thus show whether the coalition can maintain unity on the budget, healthcare cuts, and climate commitments. Tagesschau ↗
Klingbeil's budget hits coalition disputes
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Sources (3)
Expertenkommission kann sich nicht auf gemeinsame Reform zur Schuldenbremse einigen
Welt
| 05:26 08.07.
Spirituosensteuer: Spirituosenfirmen zweifeln an Mehreinnahmen durch höhere Alkoholsteuer
Die Zeit
| 05:53 07.07.
Rekordschuld hier, Kürzungen da: Lars Klingbeil wird Deutschlands Wettschuldenkönig
n-tv
| 20:31 06.07.
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