After nearly nine months without a federal budget due to elections and government formation, the Bundestag on Thursday approved Germany’s first budget under the new black-red coalition. The legislation also finalized the creation of a €500 billion special fund for infrastructure and climate protection. The AfD criticized the budget as a “debt orgy,” while the Greens and the Left accused the Union and SPD of misusing funds for election and tax giveaways.
The 2025 budget passed in a roll-call vote of 324 to 269, with total expenditures of €502.5 billion, approximately €25 billion higher than the previous year. New borrowing for 2025 is set at €81.8 billion, with additional debts for the military and infrastructure pushing total new debt above €140 billion.
“The budget paves the way for investments in Germany’s future,” wrote Chancellor Friedrich Merz (CDU) on X. Finance Minister Lars Klingbeil (SPD) told the Bundestag that the budget enables record investments of €115 billion, allowing significant spending on transport infrastructure, digitalization, social housing, schools, and kindergartens. AfD MP Michael Espendiller denounced the budget as the “largest debt orgy this country has ever seen,” claiming it would accelerate Germany’s decline.
Green budget expert Lisa Paus criticized the use of funds from the €500 billion special fund, saying that instead of adequately financing hospitals, bridges, railways, or schools, the coalition prioritized “costly election gifts.” Left MP Ines Schwerdtner added that local municipalities received almost none of the funds due to “too much bureaucracy” and too many hurdles, while the government urged citizens to tighten their belts but offered tax breaks to wealthy allies.
CDU MP Yannick Bury emphasized that the budget provides “planning and investment security,” and that investments in infrastructure and security send “a positive message for our country.” The constitutional amendment necessary for the infrastructure special fund was approved in March with the Greens’ support before the new government took office. The implementing law was now passed with Union and SPD votes.
The accompanying budget law implementing the relaxation of the debt brake in the defense and security sector was also passed. This exempts defense and civil protection spending in particular from the debt rules if it exceeds one percent of economic output. Next Friday, the Bundesrat will review the 2025 budget. Once enacted, the provisional budget, which had limited government flexibility, will end.
The Bundestag has already scheduled deliberations on the 2026 budget, expected to pass before year-end. Klingbeil also highlighted that the 2027 budget will need to address a potential €34 billion gap, which cannot be solved through accounting adjustments alone. He stressed the need for a balanced and fair “overall package” that considers all regions of the country.
Klingbeil dismissed criticisms of underfunded transport projects, noting that €166 billion will flow into transport during this legislative period, giving Finance Minister Patrick Schnieder (CDU) “the chance to really deliver.” Schnieder’s ministry had previously warned of a €15 billion shortfall in federal highways funding until 2029, causing concern among states about delays in key projects.
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