Overview
- The Bundesrechnungshof presented a report to the Bundestag budget committee on Sept. 3 and 4 that calls on the government to stop the current fiscal course and return to stronger consolidation.
- The auditors say a listed €7 billion ‘Rücklage’ is empty and that using it for the 2027 budget amounts to additional borrowing that will increase debt service costs for taxpayers.
- The government’s 2027 draft budget plans core spending of €555.4 billion and net new borrowing of €118.7 billion while combined borrowing including special funds totals roughly €200 billion for the year.
- The audit projects that following the government’s financial plan could double federal debt to about €3 trillion by 2030 and sharply raise the share of the budget spent on interest.
- Rating agencies and opposition politicians have warned of risks to Germany’s top credit rating and say rising interest costs will squeeze public services, force spending cuts or require higher taxes if not addressed.