Klingbeil's financial plan misses Stability Council criteria
The federal government misses one of four criteria in 2026 and 2027 and three from 2028. Defence spending is the cause – the rules are to be changed in a fast-track procedure.
Archive image · Photo: Raimond Spekking / Wikimedia Commons, CC BY-SA 4.0 (cropped and resized)
Germany's federal financial plan formally breaches the joint budget rules of the federal government and the states. That is according to the federal report to the Stability Council that Finance Minister Lars Klingbeil (SPD) sent to the state finance ministers, as reported by Süddeutsche Zeitung. The federal government misses one of the four stability criteria in 2026 and 2027, and three of four continuously from 2028.
Formally, the Stability Council would have to examine whether the federal government faces a "budget emergency"; in theory it could impose savings conditions. Klingbeil reportedly acknowledged "irregularities" in the 2026–2030 plan to his state counterparts. The cause is spending on modernising the Bundeswehr – tens of billions of euros a year since 2025. The Basic Law allows this to be financed by borrowing despite the debt brake, but it still worsens the key indicators.
The European Commission created an exemption for extra defence spending, which Germany uses, but the German monitoring procedure has no such clause. Instead of referring the case to the evaluation committee, the rules are to be aligned with EU law in a fast-track procedure. The change could be adopted at the Stability Council's next meeting on 3 December.