The Finance Minister next week Lars Klingbeil (SPD) will present the federal budget for 2026. But even before the text reaches the floor, the Federal Court of Auditors has already raised critical Extremely heavy. According to auditors, Germany risks sliding into an unprecedented debt spiral. "The Bund is structurally living beyond its means," reads the report analyzed by the DPA news agency and the Bild newspaper, which accuses the government of attempting to finance growing spending without adequate coverage.
Germany, auditors raise alarm: a "debt" maneuver
The heart of the protest lies in the amount of new debt expected. Thanks to the partial green light from Parliament to the suspension of the debt brake to finance extraordinary expensesKlingbeil is aiming for a budget of around 520 billion euros, with nearly 90 billion in new loans in the main budget and another 84 billion from special funds. Total: 174 billion of new debt in just one year, slightly more than an entire National Recovery and Resilience Plan (PNRR). A figure that should ring more than one alarm bell.
The Court of Auditors doesn't mince its words: "Anyone planning to finance nearly a third of expenditures with debt in 2026 is far from sound financial management." Furthermore, according to the auditors, this strategy it does not solve structural problems of German finances. On the contrary, it's making them worse. "The new debts are only a temporary fix and reduce the pressure to implement reforms," auditors warn.
Debt spiral and skyrocketing interest rate risk
The problem, the technicians explain, is that each new loan generates future interest expenses, which risk eating up an ever-larger slice of the budget, reducing the space for investments e policies social"In the medium term," the Court warns, "a huge share of resources will be absorbed by interest payments." This prospect, if not corrected, could transform the German budget into a gigantic installment plan.
The appeal by the accounting magistrates evokes a historical comparison: like the PIIGS countries during the European crisis, Germany too is apparently adopting a less than frugal, almost "grasshopper"-like attitude.
Cuts and priorities: the Court of Auditors' warning
The independent body, tasked with overseeing the state's financial management, calls for a radical change of direction: less current spending, more investment. "The government must address the spending problem immediately and structurally," the report states.
According to the auditors, Berlin must concentrate on the core tasks enshrined in the Constitution, such as defense and infrastructure, which should be financed by the current income and not debt. "Subsidies must be questioned, while investments must take priority over consumer spending," reiterates the Court of Auditors.
Germany raises alarm over public finances: €170 billion deficit by 2029
If 2026 seems complicated, the following year risks becoming explosive. The government's financial plans already include a 34 billion euro sinkholeTo bridge the gap, Klingbeil asked all ministries to save, but the ministry's own technicians admit that it won't be enough. The minister, in fact, doesn't rule out having to to cut or reduce support programs, grants e benefitsA prospect that worries not only the opposition CDU/CSU, but also part of the SPD itself, aware of the social tensions that could arise from an austerity measure.
And that's not all. Looking to the medium term, the situation appears even more worrying. Auditors are particularly critical of Finance Minister Klingbeil and Chancellor Merz's intention to accumulate approximately 851 billion euros of new debt by 2029, while medium-term budget plans still show a residual deficit of €170 billion. This mountain of liabilities risks jeopardizing the economic choices of future generations and becoming a nearly impossible burden to manage.
German maneuver between politics and reality
Chancellor Merz and Minister Klingbeil face a complex challenge: keep political promises without derailing public financesWith a budget that seeks to plug gaps through debt and the 2027 horizon already marked by potentially painful cuts, the Bundestag is preparing for a debate that promises to be intense. The Court of Auditors has sounded the alarm in stern and unequivocal tones, calling for sustainable choices. Ultimately, the budget remains the Achilles heel of every government: whether it is Berlin, Paris o RomeFinding the right balance between public spending, reforms, and debt sustainability is always a delicate challenge, capable of influencing economic stability and political consensus.
