There is never enough money. First the corona pandemic required a billion-dollar supplement to the federal budget, then the Russian attack on Ukraine. Last year, the ruling of the Federal Constitutional Court meant that budget holders had to revise their original plan. Now Finance Minister Christian Lindner (FDP) is considering continuing the series of second and third budgets that began four years ago.
An additional spending leeway of eleven billion euros is tempting – unlike in previous years, without even circumventing the debt brake. The rules allow higher government spending on credit, the country’s economic situation just has to be bad enough.
What is worrying is not the fact that the 2024 budget has to be revised again – although it was only decided at the beginning of February. As long as this is done within the framework of the debt brake, there is little to say against it. What is worrying, however, is why there is hardly any way to avoid further debt: it is the receipt for overly bold financial promises made by politicians in the past.
Above all, the price guarantees announced many years ago to promote solar and wind power plants are far above the forecasts for 2024. The reason for this is the significantly lower electricity prices on the stock exchange. Instead of 10.6 billion euros, the payments under the Renewable Energy Act are now expected to cost at least 19 billion euros this year. That will not change. Commitments are commitments.
The situation is similar with the other item that is tearing a hole in the current budget: the higher than expected expenditure on the citizens’ allowance. Here, too, it is becoming increasingly clear how little attention was paid to the potential costs when it was introduced. It is undoubtedly not only right, but also necessary, that the state helps people who need help.
But if the incentive to find a job or to increase one’s working hours to supplement one’s income is reduced at the same time, it is no surprise that costs are escalating. The adoption of another supplementary budget is not enough. At the same time, changes must be made to the specific payment rules. A state-guaranteed minimum price for the purchase of electricity from solar systems can no longer be justified these days, and adjustments to the citizen’s allowance are long overdue.
