German Parliament Approves 2025 Budget
German Federal Budget for 2025: Key Points
The German government has approved a 502.5 billion euro budget for 2025, providing planning security until the end of the year. The largest expenditure in this budget is allocated to work and social affairs, with around 190 billion euros earmarked.
Within this budget, 122.5 billion euros is allocated to pension insurance. The transport ministry's budget remains the largest investment budget, with around 62 billion euros planned for defense, an increase of 10 billion euros from the previous year.
Investments in transport are intended for railways, roads, or bridges. The transport ministry's budget for 2025 decreases by six billion euros to 38.3 billion euros. Around 23.7 billion euros is earmarked for investments in the core budget for transport, and an additional 11.7 billion euros from the special fund for infrastructure is planned.
Unemployment benefits receive around 52 billion euros, including almost 30 billion euros for the citizen's income. The equity capital of Deutsche Bahn is set to increase significantly. An additional 24 billion euros from the special fund for the military is also planned for defense spending.
A net credit intake of nearly 82 billion euros is planned for the core budget, with additional loans from special funds for military and infrastructure. The new debt is expected to exceed 140 billion euros.
Negotiations for the 2026 budget will begin in the coming weeks, aiming to pass it before Christmas. However, the opposition parties, including the Greens and Left, criticize the federal government for using tricks instead of investing in the budget.
The AfD proposes cutting climate projects, EU contributions, and arms deliveries to Ukraine to reduce debt. While the party that proposed this is not explicitly named, criticism of the CDU/CSU and the coalition under Friedrich Merz regarding financial spending policies, including military support for Ukraine, is evident.
Federal Chancellor Friedrich Merz (CDU) speaks of a "difficult task" in explaining austerity measures to the citizens. The 2025 budget only applies for a few months, and by 2027, there will be a financing gap of more than 30 billion euros.
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