Finance Minister Christian Lindner (FDP) pushes the new debt in the draft budget for next year to 17.2 billion euros.

This year he plans on net borrowing of 139 billion euros.

This would mean that the federal government would once again be operating within the framework of the debt rule after three years of crisis.

Part of the new debt are loans of 7.3 billion euros (mainly to the International Monetary Fund, but also 1 billion euros to the health fund), which are always hidden when calculating the allowable net borrowing, since the subsequent repayment of the funds is assumed.

With just under 10 billion euros corrected in this way, the federal government remains below the upper limit.

According to the medium-term financial planning, this also applies in the following years up to 2026, when new debt of between 12 and 14 billion euros a year is planned.

The Basic Law limits this to 0.35 percent of gross domestic product.

There is also an economic component.

In this way, the federal government stays within the limits of what is permitted in its planning, without once again having to make use of the exception clause for exceptional emergency situations.

Manfred Schaefers

Business correspondent in Berlin.

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The federal cabinet intends to formally adopt the 2023 budget draft and medium-term financial planning on Friday.

Expenditures of 445 billion euros are planned for next year - 50 billion euros less than in the current year, mainly because Corona-related expenses will no longer apply.

In the following years up to 2026, the spending framework is between 420 and 440 billion euros.

They worked with the most likely scenario, but the forecast uncertainty was extremely high, government circles said on Wednesday.

The planning is based on the government's spring projection from April.

Economic growth of 2.2 percent this year and 2.5 percent next year is assumed.

As a precaution, Lindner has planned additional expenditure of 5 billion euros, for example for the purchase of gas reserves.

In times of sharply rising prices, it was said in Berlin that one had to get away from a policy with high additional credits.

This also coincides with the assessment of the international organizations.

"Compliance with the debt brake will also dampen inflationary pressure."

tap reserves

The coalition has to tap the reserve next year with a good 40 billion euros - a little more than last thought.

In 2024, 7.7 billion euros will still be available.

The turnaround in interest rates on the capital market is having a negative effect.

Lindner calculates around 30 billion euros for debt service in 2023.

For comparison: last year it was almost 4 billion euros.

After the federal government used to place its bonds on the market with a premium, a discount is now necessary if it wants to find buyers for paper with a low interest coupon from its portfolio.

Added to this is a sharp increase in provisions for inflation-indexed bonds.

For this alone, an additional 8 billion euros will be needed next year.

The largest block of expenditure next year is the subsidy for the statutory pension insurance with 112.4 billion euros.

Almost 60 billion euros are earmarked for the Bundeswehr, of which around 8.5 billion euros come from the special fund.

The approach to development aid is likely to decrease slightly.

But Germany remains the second largest donor in the world, it said.

The aid rate will probably fall from 0.76 percent this year to 0.67 percent.

This means that the international target value is reached on average.