The German government has approved the 2025 federal budget after months of contentious negotiations, balancing fiscal discipline with measures to stimulate economic growth. The budget, totaling 480.6 billion euros, includes a record-high 78 billion euros allocated for investments. New borrowing is set at 43.8 billion euros, adhering to the constitutional debt brake that limits the deficit.A significant and controversial aspect of the budget is the reduction of military aid to Ukraine from 8 billion euros in 2024 to 4 billion euros in 2025. This decision comes amid ongoing international security concerns and has raised questions about Germany’s long-term commitment to supporting Ukraine.The budget aims to boost the economy, maintain social benefits, and address international security situations. It includes additional funding for defense, law enforcement agencies, and families. However, some ministries, particularly those of development cooperation, environment, and economy, will face budget cuts.Finance Minister Christian Lindner emphasized the importance of complying with the debt brake to ensure stability in Europe. The government also plans to implement a growth initiative to strengthen private investments, innovation, and reduce bureaucratic burdens.Opposition parties, including the Union and the Left, have sharply criticized the budget plan, with some calling it the ‘worst in the history of the Federal Republic’. Critics argue that the plan does not adequately address the country’s real challenges and is based on unrealistic assumptions.The budget still faces a tough passage through parliament, with some lawmakers unhappy with the belt-tightening measures. There are also concerns about a projected financing gap of around 17 billion euros, which the government hopes to close through stronger-than-projected growth and tax revenues.Chancellor Olaf Scholz defended the compromise reached by the coalition, emphasizing that this is not an austerity budget but one that prioritizes investments and social benefits. The budget is expected to be approved by the end of November after further discussions in the Bundestag.
Key points
- German government approves 2025 budget with total expenditures of 480.
- Military aid to Ukraine reduced from 8 billion euros in 2024 to 4 billion euros in 2025.
- Record-high investments of 78 billion euros included in the budget.
- Budget adheres to constitutional debt brake with new borrowing of 43.
- Opposition parties criticize the budget, calling it inadequate to address real challenges.
6 billion euros.
8 billion euros.
Contradictions👾While most sources report increased funding for the Ministry of Defense, one source mentions a reduction in its funding.
