Second Supplementary Budget 2021
The Federal Government has passed a Second Supplementary Budget for the current year. Funds from budgeted but unused credit appropriations are to go toward climate protection as well as measures to transform the German economy. No new debt is planned for this purpose.
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The supplementary budget showed that the Federal Government was taking “swift and decisive action” to tackle the major challenges, said Finance Minister Lindner.
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Due to the ongoing coronavirus pandemic, it was not possible to go ahead with many of the investments planned for the current year, or at least not to the extent planned. At the same time, targeted stimuli are needed in the current situation in particular so as to ensure the economy is in good shape in the aftermath of the crisis. The Federal Government is sending out a clear signal for investment in the future by launching the Second Supplement to the 2021 Federal Budget.
Clear signal for investments in the future
This frees up an additional sum of 60 billion euros – funds that have not been spent this year or have been added to the budget – for investments in the future, climate action and projects to transform the German economy. The supplementary budget allocates this amount to the Energy and Climate Fund, making it available in the coming years. “60 billion euros for investments in the future is a booster for the economy”, said Federal Finance Minister Christian Lindner.
No additional debt necessary
No new debt is required for this, nor has the authorised borrowing cap been increased. However, the permitted upper limit for new debt will continue to be exceeded – by 207 billion euros according to current calculations. In view of infection rates in particular, the Federal Government believes this excess is justified since the situation in the country is still defined as an emergency under the Basic Law. Whether or not the requirements for this are met is decided by a parliamentary majority in the Bundestag.