Germany to Implement Interim Budget Due to Elections in 2025

The German Ministry of Finance has announced that a provisional budget will be implemented at the beginning of 2025. This decision was made following the collapse of Chancellor Olaf Scholz's three-party coalition. As the country prepares for elections scheduled for February 23, the need for a temporary financial plan has emerged.

Finance Minister Joerg Kukies and the budget department have communicated with all ministries and government agencies, stating that the temporary government will manage the country's finances based on the 2025 draft budget until a new administration can establish its own financial strategy.

The provisional budget will be limited to legally mandated expenditures and obligations essential for the functioning of the country. This includes payments for unemployment and child benefits, student scholarships, and funding for ongoing or planned construction projects. In emergencies, parliament holds the authority to approve additional expenditures.

The need for a provisional budget arose after coalition parties failed to reach an agreement on the 2025 budget in November. Subsequently, Chancellor Scholz removed Christian Lindner, a member of the Free Democrats, from the position of finance minister. Lawmakers are expected to approve a motion for the dissolution of parliament on Monday, facilitating early elections.

The provisional budget is intended to remain in effect throughout coalition discussions and until the new government finalizes its budget for 2025. Officials from the Ministry of Finance anticipate that the new government will likely finalize its budget in the second half of next year.