Overview
- The plan keeps the March-loosened debt-brake rules in place through 2029, then runs a 2030–2035 transition to lower deficits before revised constraints take effect in 2036.
- From 2036, the federal government would gain a permanent borrowing allowance of 0.8% of GDP exclusively for additional capital investment.
- A separate variable credit space would depend on the debt ratio, allowing 0.35% of GDP each for the federal and state levels when debt stays below the EU’s 60% benchmark and only 0.1% when it is above.
- The Bundesbank calls for ending the open-ended defense exemption by 2036 and warns current rules could lift debt toward roughly 90% of GDP in coming years and above 100% over time.
- The proposal follows a spring constitutional change that created an off-brake special fund of up to €500 billion, with a government commission due to present its reform report in the first quarter of 2026.