(Bloomberg) — German Finance Minister Christian Lindner won’t yield to pleas from some of his cabinet colleagues for more money in next year’s budget and will stick firmly to his goal of enforcing strict borrowing rules, according to one of his deputies.
Most Read from Bloomberg
Defense Minister Boris Pistorius, Foreign Minister Annalena Baerbock and Labor Minister Hubertus Heil, among others, have asked Lindner for more cash. Yet his room to satisfy their demands is limited by weaker than expected tax revenue projections and his determination to stick to the so-called debt brake enshrined in Germany’s constitution.
Both Social Democrat Chancellor Olaf Scholz and Robert Habeck of the Greens, the vice chancellor and economy minister, have publicly backed Lindner, who leads the fiscally hawkish Free Democrats, the smallest member of the three-party ruling alliance.
“The chancellor has stressed that he wants to fulfill the requirements of our constitution,” Florian Toncar, a parliamentary state secretary who is effectively Lindner’s No. 2, said Tuesday in an interview with Bloomberg Television in Frankfurt. “The ministry of finance is really toughly working on that.”
Read More: Germany Preparing €7 Billion Tax Package to Prop Up Economy
Lindner is aiming to get next year’s budget approved in cabinet in early July before it’s sent to parliament in mid-August.
It would then be expected to win backing by the end of the year from lawmakers in both the lower house, or Bundestag, and the Bundesrat upper house, where the 16 federal states are represented.
Pistorius is the only minister excluded from Lindner’s savings drive. That’s to enable Germany to keep Scholz’s promise to meet NATO’s goal of spending at least 2% of gross domestic product on the armed forces over the longer term.
Habeck was quoted as saying Wednesday that although some of the requests for additional funds are “often well justified,” the government needs to set priorities.
“Because you can’t just print money at will, we have to cut back in other areas,” he told the Rheinische Post newspaper.
Referring to farmers’ protests at the start of the year over the government’s plan to scrap diesel subsidies, he added: “And of course we have to do this carefully — last time, even small cutbacks led to major protests.”
Most Read from Bloomberg Businessweek
©2024 Bloomberg L.P.
