Due to violations of exceptions to the debt brake, the German Constitutional Court declared the second supplementary budget for 2021 unconstitutional and void. With the budget change, the government wanted to use loans for climate protection that were originally intended for CoV measures.
The size of the “climate and transformation fund”, for which money is now earmarked, will therefore decrease by 60 billion euros. “If the obligations already assumed can no longer be fulfilled, the budgetary legislature must compensate for this in other ways,” Germany’s highest court in Karlsruhe said today. The Union faction in the Bundestag successfully sued against redistribution.
“Clap your hands loudly”
Alexander Dobrindt, chairman of the CSU regional group in the German Bundestag, described the verdict as “a slap in the face to the Chancellor and the traffic light coalition”. “Today’s decision declared this budget manipulation by the yellow left unconstitutional and null,” said Dobrindt. As a result, there is now a gigantic 60 billion hole in the federal budget. “The traffic light is also responsible for a budget that is blatantly unconstitutional.”
The German government is temporarily suspending projects that should be financed by the Climate and Transformation Fund. This applies to commitment authorizations for 2024 and following years – with the exception of measures to promote energy efficiency and renewable energy in the construction sector, said Finance Minister Christian Lindner (FDP). “We will immediately begin drafting a new economic plan for the climate and transformation fund for 2024.”
Significant impact
According to Lindner, the decision could have far-reaching effects on the budgetary policy of the federal government and all states. Therefore, it will be scrutinized in detail, he said.
Chancellor Olaf Scholz (SPD) also announced that he would “closely observe” the new budget guidelines. It is conceivable that the decision will result in a “very profound change in budgetary practice”, Scholz said today at the Bundestag plenary session. “There is no need for hasty action, but rather careful examination.”