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Germany to trim overall budget in 2024 as it invests more in defence

Germany plans to cut spending and borrowing substantially next year following massive outlays during the coronavirus pandemic and energy crisis, a draft of the budget showed Monday.

A sign reading
A sign reading "Ministry of Finance" stands in front of the Ministry of Finance of Baden-Württemberg. Photo: picture alliance/dpa | Sebastian Gollnow

But the defence budget will hit a record high, and is expected to reach the two-percent NATO spending target, as Berlin invests in overhauling the military in response to Russia’s invasion of Ukraine, it showed.

There have been drawn-out negotiations in the three-party ruling coalition over the budget due to cost cuts demanded by Finance Minister Christian Lindner, from the pro-business FDP party, but the cabinet is finally due to approve it Wednesday.

READ ALSO: Germany approves funds to buy nearly €4 billion air defence system

Europe’s biggest economy, which fell into recession at the turn of the year, is forecasting spending in 2024 of €445.7 billion, compared to €476.3 billion planned for this year.

The reduction in new borrowing is even more drastic, with €16.6 billion planned for next year compared to €45.6 in 2023.

Germany should thus comply with its constitutional “debt break” which limits new annual borrowing to 0.35 percent of gross domestic product a year, according to the draft.

After being suspended from 2020 as Germany spent huge sums to tackle the coronavirus crisis, the budget rule came back into force this year.

But to ensure that the 2023 budget complied with the debt break, the government has had to resort to creating several special funds that are outside the official budget.

They have been used in particular to help households and businesses cope with rising energy prices after Russia slashed crucial gas supplies to Europe amid the Ukraine war.

The government will tap one of these funds to ensure it hits the NATO spending target in 2024, according to the draft budget.

A sum of €51.8 billion will form the regular defence budget, a new high after about €50 billion in the 2023 budget.

There will be an additional €19.2 euros from a special, 100-billion-euro pot for the military that Chancellor Olaf Scholz established after the start of the Ukraine war.

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MONEY

How German ministers want to protect online ticket purchases

Once a year, consumer rights ministers from Germany's federal and state governments gather for a joint conference. This year, improving online ticket sales and better data protection measures are on the agenda.

How German ministers want to protect online ticket purchases

North Rhine-Westphalia’s consumer protection minister Silke Gorißen (CDU) will present proposals for further consumer protections for online ticket sales at the consumer ministers conference (VMK) on Thursday and Friday. 

Gorißen is pushing to make online ticket sales more transparent and give consumers more rights to back out of purchases if they don’t have enough information. 

Under the proposals, consumers would receive more information before purchasing tickets, such as details on the number of tickets sold by each provider and the prices for different seat categories.

Currently, ticket prices are often only visible during the purchasing process. 

The ministers will also consider whether consumers should be granted a right of withdrawal when buying tickets online. 

READ ALSO: How Germany is making it easier for consumers to cancel contracts

“The process of buying tickets is becoming increasingly complex and confusing, often limited to very narrow time windows,” Gorißen told DPA ahead of the conference. “I expect providers to act more in the interest of consumers. The market power of large ticket portals should not result in unclear and non-transparent sales.”

More data protection online

According to DPA, Gorißen also wants users of telecomms services to be better protected when it comes to their personal data. 

NRW’s consumer minister believes providers of emails, chats, or telecommunications services should be required to put measures in place to detect malware that’s designed to steal personal information from users. This should be done at the EU level, Gorißen said. 

Moreover, Gorißen says there should be more information on online safety made available through a consumer hotline. 

“IT security responsibility should not solely depend on the digital competence of users,” the CDU culture minister explained. “Protection against cyberattacks must become a societal responsibility.”

READ ALSO: The German mobile companies with the best – and worst – coverage

The proposals are set to be voted on by consumer ministers on Friday. 

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