BERLIN, March 21. /TASS/. The Bundesrat, Germany's House of Representatives for the federal states, has approved amendments to the Constitution that will facilitate the easing of the so-called "debt brake" - a regulation that prohibits spending more money than the government takes in. This change is related to plans to increase defense spending and establish a special infrastructure fund of 500 billion euros. The Bundesrat passed the amendments with a two-thirds majority, securing 53 out of 69 votes, as reported by Ntv TV.
Experts are calling the current financial package historic, as it may pave the way for investments totaling between 1 and 1.5 trillion euros. The amendments specify that defense spending exceeding 1% of GDP will be exempt from debt restrictions. Additionally, the new infrastructure fund will not be subject to the ‘debt brake." The German parliament approved the amendments on March 18, and they are expected to take effect next week after the president signs them.
The conservative bloc, consisting of the Christian Democratic Union (CDU), the Christian Social Union (CSU), and the Social Democratic Party (SPD), spearheaded the initiative to lift restrictions on financing defense and infrastructure spending. However, obtaining a two-thirds majority in the new Bundestag is likely to be impossible, as both the Alternative for Germany and the Left Party have indicated they will not support the easing of the "debt brake." This was feasible in the previous Bundestag, requiring consensus between the CDU/CSU, SPD, and the Greens. A compromise with the Greens was reached on March 14, which includes allocating 100 billion euros from the new fund for climate protection initiatives. Furthermore, the fund's name illustrates its dual purpose: to attract additional investment in infrastructure and to achieve climate neutrality by 2045.
Additionally, the federal states will now have the ability to increase their debt, permitted to borrow up to 0.35% of their total nominal GDP. The new fund will allocate 100 billion euros to the regions.Previously, the Federal Constitutional Court dismissed complaints filed by several Bundestag members aimed at preventing a vote on the amendments.