Reform of the debt brake: Greens want to support municipalities with more money

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Green politicians Haßelmann, Habeck, Dröge, Baerbock at the 2023 exam: Offer to the states

Photo: IMAGO/Jacob SchrÅ¡ter / IMAGO/Jacob Schröter

The Green parliamentary group in the Bundestag is pushing for a reform of the debt brake - through an investment fund that should also benefit states and municipalities.

This is what it says in a motion that the parliamentary group wants to pass at its meeting that begins on Monday and which is available to SPIEGEL.

The Green MPs meet in Leipzig from Monday to Wednesday to talk primarily about democracy and cohesion.

What is needed is a “new economic awakening,” says the draft proposal, as well as “massive investments in the future of our country.”

Companies, economists and many CDU prime ministers would also see it that way.

New fund for investments in infrastructure

The applicants' core proposal: a "Germany investment fund for the federal, state and local governments."

What exactly such a fund should look like is not clear from the application.

However, the central properties are described.

Accordingly, there should be an economic plan, such as the one that exists for the Climate and Transformation Fund.

The new fund should finance investments in “modernization and decarbonization of the economy and in future technologies,” including a premium for climate investments, it continues.

But other investments should also be financed.

The application mentions, for example, cycle paths, the hydrogen infrastructure or the digitalization of the rail network.

In addition, the fund should “provide sufficient funds for states and municipalities to partially finance urgently needed investments in school buildings, buses and trains, affordable apartments or swimming pools and local sports fields.”

This means that municipalities that are often particularly burdened would also benefit from the additional money.

A reform of the debt brake would be necessary

The proposal aggressively deals with the fact that none of this is possible under the current debt rules: “We are making the Germany Investment Fund possible by reforming the debt brake,” it says.

In essence, as the Greens have suggested several times, “investments that create new values” should be able to be financed through loans in the future.

For a major reform of the debt brake, however, it would not only require an agreement in the coalition, especially with the FDP, which has so far vehemently stuck to the current debt brake.

The Union's approval in the Bundestag and in the states would also be necessary.

This seems unlikely at the moment, but state politicians from the Union, which governs many states and communities, have repeatedly shown themselves to be more open to such considerations in recent months than the leadership of the CDU.

“In their districts and villages, people feel when the bus doesn’t run, when there are no affordable apartments or when the roof of the school is leaking,” said parliamentary group leader Katharina Dröge about the proposal: “That’s why the Germany Investment Fund is also one Invitation to the states and municipalities: We want to use part of the fund to directly support states and municipalities with these challenges and to help the country finally function properly again.

In the proposal, the Green Party makes a number of suggestions, such as integrating migrants into the labor market, reducing bureaucracy or increasing the minimum wage to “over 14 euros”.