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MIL OSI Translation. Region: Germany / Deutschland –

Source: CDU CSU

Dear Madam President! Dear Colleagues! Ladies and gentlemen! We are debating the government draft for the 2021 budget with a volume of a good 400 billion euros. That is around 100 billion euros less than we have in the current year, but the volume is still at a record level.

The final round offers the opportunity to review this household week. The debate is of course shaped by the Covid-19 pandemic, which affects all areas of life. Above all in the economic-fiscal area, we are experiencing a collapse in the economy of historic proportions. The response in Germany and the EU came through aid packages of enormous size. But at this point I would like to repeat very clearly and with great pleasure: this aid has only become possible thanks to years of solid budget policy. What have we been criticized for! But it was only through this that we created the leeway that we now benefit from. That’s what we stand for.

(Applause from the CDU / CSU)

The crisis naturally presents us with the greatest challenges in terms of fiscal and monetary policy. In addition, there are megatrends with major financial effects. The ecological and digital transformation of the national economies should be mentioned here. But the budget is not an end in itself, it is a policy that is expressed in figures. And in my opinion, this budget is pursuing three goals: firstly, mastering the crisis, secondly initiating sustainable economic recovery and not just kindling a flash in the pan, and thirdly – every one of us at home feels this every day in our conversations – the cohesion of the Improve society. These are the goals and we want to achieve them. The means to achieve this is a budget with responsibility and vision.

(Applause from the CDU / CSU)

Of course, it is now right to make temporary expansive expenditure in order to achieve these goals. But of course we have to constantly question the expenditure. The watering can principle must not be introduced; because we have to be able to afford the expenses in the long term. That is generation-fair and sustainable.

(Christian Dürr [FDP]: But the bazooka is the watering can turned into a weapon!)

And of course we have to quickly return to the path of fiscal virtue and stick to the debt brake again; because we do not know what will happen in the future economically and financially.

I am firmly convinced that we can grow out of the crisis. But we can only grow out of the crisis if growth is greater than the increase in spending.

(Christian Dürr [FDP]: Yes!)

A comparison with other industrial nations is of course good and is correct at this point: We have come through the crisis quite well so far – no question about it -; You can be proud of that for a moment. But we have to be careful and continue to act carefully.

A comparison with the financial and economic crisis of 2008/2009 is factually correct; but from my point of view this comparison is limping. Yes, economically the slump was similar then as it is today: then 5.7 percent; now it is expected at 5.8 percent. Yes, the debt versus total GDP was similar: 82 percent debt at the time; now we’re forecasting around 80 percent next year. And yes, the economic upturn began again quickly: 4.2 percent then; we now expect 4.4 percent. But the important framework conditions of that time have completely changed compared to today. I would like to make this clear to you with three examples:

First. At that time, we were structurally able to save 30 billion euros in interest payments. The federal interest burden has fallen from 40 billion euros to 10 billion euros per year. It doesn’t go much deeper, even in this phase of low interest rates. The loans are essentially rescheduled and we will see a sideways movement or even a slight increase; because we took on new debts. We discussed that on a large scale several times this week. Let me remind you again: the debts that we are taking on this year and planned for next year amount to over 300 billion euros. It wasn’t long ago – 2016 – when this amount roughly corresponded to the entire budget of the Federal Republic.

Secondly. The share of tax revenue is shifting more and more towards states and municipalities. In addition, there is more and more structurally unbound relief from federal states and municipalities, which hardly anyone talks about. We are doing good and try to help the municipalities and states where we can. From this year onwards, for every EUR 1 in sales tax, more money goes to the states and municipalities than remains with the federal government. The federal states and municipalities will not reach the pre-crisis level of tax revenue in 2021 and the federal government will not return until 2023.

Third. From 2026 onwards, we will have to repay the debts that we take on this year and next, according to a fixed repayment schedule – as stipulated by the Basic Law; that is an additional burden of around 11 billion euros that we will face in the long term.

That means it will be much more difficult to balance the budget than it was after the financial and economic crisis ten years ago. But it is our firm will to achieve this balance as quickly as possible, and we will achieve this together if we take various criteria into account.

(Applause from the CDU / CSU)

In my opinion, there are four essential guidelines that we can come up with.

Firstly, the expenditure must be kept as stable as possible or only increased moderately.

(Christian Dürr [FDP]: No basic pension to be decided!)

Second, the approaches must be questioned. A household – I heard that again a lot this week – is not good because its volume is larger than last year.

(Christian Dürr [FDP]: Right!)

That is the wrong way of thinking.

(Applause from members of the CDU / CSU and the FDP)

It’s not about saving at all, it’s about the effective use of funds.

Thirdly – this is probably the most important point – the politically decided money must flow out, be implemented, be called up. You can’t just stand in the shop window,

(Christian Dürr [FDP]: That’s how it is!)

but they must serve the political purpose.

I can explain that again with three or four examples. Let’s take a look at the remainder of household spending: from 2016 to 2020, it rose from 9 to 22 billion euros in this country. The EU currently has politically tied funds, which are not flowing away, currently in the order of magnitude of almost 300 billion euros. The existing special funds – EKF, childcare expansion, digital funds, all-day expansion, municipal investment promotion funds are a few examples – have high stocks, but the funds are not called. We have to get better there; then we also generate our politically desired effect.

(Applause from the CDU / CSU and members of the SPD)

Last but not least. We must continue investments at the high level as we know it now, especially in areas that make our country fit for the future: digitization, research and development, education, infrastructure and climate protection. In a sense, these are profitable debts for the country and its people. We have to work on that. If we do that with these guard rails, both in the preparation of the budget and, above all, in the implementation of the budget, then there is also a budgetary and a financial opportunity in this crisis. That’s why I’m looking forward to the budget consultations.

Thank you for your kind attention.

(Applause from the CDU / CSU and members of the SPD)

MIL OSI

EDITOR’S NOTE: This article is a translation. Apologies should the grammar and / or sentence structure not be perfect.

MIL Translation OSI