Budget: New debt rises to 119 billion euros

Germany once again spent significantly more money than it earned in 2024. A deficit of 113 billion euros was originally expected.

Despite record revenues, the German government recorded a higher deficit last year than previously expected. According to current figures from the Federal Statistical Office, federal, state, local and social insurance spending exceeded revenues by 118.8 billion euros - 15 billion euros more than in 2023. The total corresponds to a deficit of 2.8 percent of gross domestic product. Despite economic challenges, Germany remains below the three percent upper limit set out in the EU Growth and Stabilization Pact. A deficit of 113 billion euros was originally expected.

At 62.3 billion euros, the federal government accounted for a good half of the 2024 government deficit. While the financial gap was reduced by 30.5 billion euros compared to the previous year thanks to rising tax revenues, the deficit of the states and municipalities grew significantly. In addition, social insurance recorded a deficit of 10.6 billion euros last year, after a surplus of 9 billion euros was generated in 2023. This means that for the first time since 2009, the federal government, states, municipalities and social insurance were all in the red.

State expenditure, on the other hand, rose by 5.3 percent to 2.13 trillion euros. "It thus rose more than revenue," the statisticians emphasized. Interest expenditure increased by 24.2 percent. Monetary social benefits grew by 7.0 percent. "This was primarily the result of higher spending on pensions," it said. "Significantly more was also spent on care allowances and citizen's allowances." Social benefits in kind increased by 8.0 percent. "This was due, among other things, to increased spending on hospital treatment, medication and care, as well as higher spending in the areas of youth, integration and social assistance," according to the statistics office. In contrast, subsidies fell by 35.6 percent. This was because the energy price caps ended at the end of 2023.

In view of the economic crisis and the pressure to spend more money on defense, a debate has erupted about loosening the debt brake. However, a reform of the debt brake, which is anchored in the Basic Law, requires a two-thirds majority in the Bundestag.