• Mon. Dec 11th, 2023

New Title: German Government Turns Down Proposal for Economic Stability Program


Nov 21, 2023

On November 15, 2023, the German government appeared at a hearing in the Bundestag to discuss the ruling of the constitutional court last week that prohibited the transfer of 60 billion euros from unused funds in the pandemic to green projects. According to a source close to the finance ministry, credit authorisations for the economic stabilisation fund cannot be used in 2023 under current legal circumstances. This means that all spending not yet used this year is now blocked and requires approval from the finance ministry.

In response to this court ruling, Werner Gatzer, state secretary at the finance ministry, wrote in a letter on Tuesday that payments related to energy price breaks are not affected by this ruling. The economic stabilisation fund was created in 2020 to support companies during the pandemic but has since shifted its focus to addressing the energy crisis. Handelsblatt business daily was first to report on this decision by blocking spending from ESF for 2023.

The government is working quickly to address the implications of this court ruling and find a solution for blocked spending from ESF for this year. The source close to the finance ministry stated that payments related to energy price breaks are not affected by this ruling. The budget committee had previously approved such spending before, and now it needs approval from finance ministry before any payment can be made. The government is committed to finding a way forward and ensuring that businesses receive adequate support during these challenging times.

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