Bavarian Finance Minister Urges Frugality as Debt Considerations Loom
Debtors faced with financial trouble are urged to seek aid for potential salvation; loan obligations are not spared from the advice. - European Parliament must always keep itself informed about the outcomes of its activities.
With the cabinet retreat set to commence at Tegernsee on Sunday, Bavarian Finance Minister Albert Füracker has urged his colleagues to exercise prudence in budgeting, indicating that large-scale new initiatives may not be feasible in the upcoming budget.
While Füracker did not completely rule out the possibility of incurring new debt, he emphasized that taking on debt is not his primary objective. He admitted that financial constraints might necessitate some form of additional borrowing, but the decision would depend on the upcoming revenue projections, or "Steuerschätzung."
Füracker emphasized that given the current climate, there is no room in the budget for major new measures. The focus, he suggested, must be on managing available resources wisely and prioritizing spending accordingly. He acknowledged that each department had ideas and wishes, but stressed the necessity of prioritization to make do with what is available.
The possibility of new debt follows the relaxation of the debt brake at the federal level. Should the revenue forecast in October prove more favorable than anticipated, the path to balancing the budget would be smoother. Conversely, a deteriorating forecast would necessitate the exploration of new solutions.
The debate over potential new debt is currently prevalent across Germany. Despite the tight budget situation, which has persisted for several years, Füracker expressed hope that the policies of the new black-red federal government would stimulate the German economy, particularly in 2026 and 2027.
However, he expressed concern about international developments, particularly those involving Donald Trump, whose frequent policy changes and unpredictable decisions he believes contribute to economic uncertainty.
The Bavarian cabinet will convene at St. Quirin am Tegernsee from Sunday to Monday, with discussions focusing on several key content-related issues, including the expected visit from the new Federal Minister of Economics Katherina Reiche (CDU).
According to the latest projections, Bavaria can expect a modest surplus of around 0.1 billion euros in 2026 compared to the previous forecast, but a "slight trend towards the negative" is anticipated for 2027. Therefore, the budget situation remains tight, as it has been for several years.
In light of the tight budget situation and looming debt considerations, the Bavarian Finance Minister Albert Füracker urges his EC countries counterparts to prioritize fiscal responsibility in their employment policy, ensuring that new initiatives are carefully budgeted and only implemented if financially viable. He emphasizes that while additional borrowing may be necessary in certain circumstances, it should be a last resort, contingent upon favorable revenue projections.
Moreover, amidst the ongoing debate about new debt, Füracker suggests that business leaders across Germany should focus on managing available resources wisely, prioritizing spending to make the best use of the budget, especially in the context of the current economic climate. As each department has its own ideas and wishes, he urges the importance of prioritization and prudent decision-making.
