Kevin Kühnert sees current government spending not affected by budget freeze

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SPD Secretary-General Kevin Kühnert: Debate on debt brake

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Bernd von Jutrczenka / dpa

The serious effects of the Federal Constitutional Court's ruling on the climate fund are becoming clearer. The Federal Ministry of Finance has blocked parts of the budget. However, SPD Secretary-General Kevin Kühnert has emphasized that the state continues to pay for current benefits despite the blocking of budget funds.

The step of the Federal Ministry of Finance does not mean that the state is no longer allowed to make spending, Kühnert said on Tuesday in the ARD "morning magazine". The suspension of so-called commitment appropriations means that no payment obligations for the future are possible. However, the state can cover all its current benefits.

The Ministry of Finance also said that the blocking of items in the budget for the current year does not mean a spending freeze. The funds set aside for 2023 could flow regularly, ministry circles said on Tuesday morning. It is merely a blocking of obligations for the coming years. As a precautionary measure, these would be stopped in the event that the Karlsruhe budget ruling was also to be applied to older reserves in special funds.

The Ministry of Finance had blocked the commitment appropriations from the 2023 budget. These are financial commitments for the coming years, which will be used, for example, for multi-year projects.

The background to this is the ruling of the Federal Constitutional Court, which annuls the reallocation of loans amounting to 60 billion euros in the 2021 budget. They had been approved to cope with the corona crisis, but were now to be used for climate protection and the modernisation of the economy. At the same time, the judges ruled that the state should not set aside emergency loans for later years. Therefore, in addition to the Climate and Transformation Fund, other ancillary budgets of the federal government could be affected.

SPD backs chancellor's leadership

The deputy chairman of the SPD parliamentary group, Matthias Miersch, has welcomed the decision by the Ministry of Finance to freeze the budget for all further expenditure. "I think it's a sensible step," Miersch said on RTL/ntv's "Frühstart." After the Constitutional Court ruling, the Federal Government must first assess the situation and analyse it calmly. "And then you actually have to meet this challenge as part of an overall package."

This will succeed if all traffic light partners work sensibly with each other. "That's what I expect now, and the Chancellor will lead now."

Despite the concerns of the Federal Court of Auditors, Miersch assumes that the 2024 federal budget can be passed by the Bundestag as planned next week. The problem is the special pot of the Climate and Transformation Fund. "The core budget is not the main problem." However, it would be necessary to wait for the expert hearing in the Committee on Budgets and then decide how to proceed.

This Tuesday, experts are expected to help the Bundestag and the federal government correctly interpret the consequences of the Karlsruhe budget ruling. The Committee on Budgets hears experts nominated by the various political groups. Above all, it should be a question of whether, despite the ruling, the budget for 2024 can be adopted.

Kühnert sees suspension of the debt brake as justified

One thing is clear: the traffic light coalition must find ways to fill the 60 billion euro gap in the federal budget. SPD Secretary-General Kühnert pleads for a suspension of the debt brake.

With regard to the declaration of a so-called budget emergency, he said on ZDF: "If the SPD were to govern alone, then that would certainly be something we would do, and not out of trickery, but because the emergency situation is objectively given." This is being discussed in the coalition. According to the law, the government can declare an emergency and suspend the debt brake if it has fallen into a crisis through no fault of its own.

But there are also other options, Kühnert said. This would have to be discussed in the coalition. There is no point in all parties reading each other their election programmes, said the SPD general secretary.

The necessity of the 60 billion euros for climate protection and the transformation of the economy has not changed. It is now necessary to find other sources of income in order not to fall behind in international competition.

At the same time, Kühnert rejected blanket savings. "I can only say for the SPD to simply save 60 billion with the lawnmower somewhere in the budget, to make social cuts, to take back the transformation of our society, to no longer support companies in international competition and thus lose jobs in Germany, that's something, that's what the SPD was not elected for in 2021, and that's why we will never raise our hand in the German Bundestag."

Warning of consequences for East Germany

The Parliamentary State Secretary in the Federal Ministry of Economics, Michael Kellner (Greens), warned that the budget ruling of the Federal Constitutional Court would hit East Germany particularly hard. If the missing 60 billion euros for the Climate and Transformation Fund are not raised elsewhere, the East German economy is threatened with considerable damage, Kellner told the editorial network Germany (RND)

Of the announced investments in German industry of 80 billion euros, around 50 billion were in East Germany, Kellner said. "We are now faced with the huge challenge of securing these investments, as well as the jobs and prosperity associated with them, through government support."

Kellner emphasized that, as things stand today, neither the settlement of the chip factories in Dresden and Magdeburg, nor the reconstruction of the solar industry in eastern Germany, would be secured without the Climate and Transformation Fund.

On the other hand, FDP finance and budget expert Frank Schäffler called for the waiver of subsidies for the chip factories in Magdeburg and Dresden. "It has always been wrong to put billions in subsidies into the settlement of chip factories," Schäffler told RND.

Accordingly, Schäffler did not accept the argument of subsidies in disadvantaged regions: The planned locations of the chip factories, Magdeburg and Dresden, are not structurally weak areas. "On the contrary, there is a shortage of workers there," said the FDP politician. "And the construction of the chip factories would mean that medium-sized companies would lose out locally."

mmq/dpa/Reuters