section_path: Government formation/Debt brake agreement
section_name: Debt brake agreement
paragraph_text: Debt brake agreement
  
  On the evening of 4 March, after it had already become apparent several times over the course of the previous days, it was made public that the CDU/CSU and SPD had reached an agreement on billions in debt. According to the draft, there were plans to change the Basic Law (German constitution) in order to exclude defence expenditure of over 1% of GDP and a second special fund, this time not for defence as in 2022, but for infrastructure in the amount of 500 billion euros. However, Merz had ruled out a reform of the debt brake and additional debt during the election campaign.
  
  Since the proposals would require changes to the Basic Law, they would require approval by a two-thirds majority in both the Bundestag and the Bundesrat; however, in the newly elected, incoming Bundestag, parties opposed to these changes (the far-right AfD and The Left) together held a blocking minority of more than one third of the members. The prospective coalition partners (CDU/CSU and SPD) therefore decided to attempt to pass the legislation through the outgoing 20th Bundestag (elected in 2021), where they could reach the necessary majority if either Greens or FDP voted in favour. Therefore the parties requested two special sessions on the proposed constitutional changes (12 and 18 March). According to Article 39 (2) of the Basic Law, an outgoing Bundestag is capable of acting until the inauguration of the newly elected parliament, no later than the 30th day after the election. An outgoing Bundestag had decided on urgent matters before but never on changes to the Basic Law, nor had this previously been done by a parliament prematurely dissolved.
  
  On 8 March, both sides started of coalition negotiations and set out their initial common positions in a paper. The plans were critisised by the AfD, which saw it as " socialism ". The FDP viewed it as "ideologised climate policy". The Greens and The Left criticised omissions in the social sphere, and the BSW saw it as "a red carpet rolled out for the AfD to enter the Chancellery in 2029". Economists also criticised the paper. On 10 March, the Greens, on whose approval the CDU and SPD are reliant on for their plans, announced that they did not want to approve the project. Instead, they introduced their own draft bill in the Bundestag which, among other things, called for the debt brake to be applied not only to defence, but also for civil defence and cyber security from 1% of GDP. At the same time, they saw the special funds for infrastructure as a way for the SPD and CDU/CSU to finance their election campaign promises, instead of the infrastructure. Nevertheless, they were open to talks. At the same time, The Left and AfD took their case to the Federal Constitutional Court to appeal against the special sessions and the constitutional amendments in the "old" Bundestag as they felt their rights as members of parliament had been violated. The requests for an interim injunction were rejected by the Federal Constitutional Court on 14 March.
  
  The first of the two special sessions was then held on 12 March in the Bundestag. The SPD and CDU/CSU motions, as well as those of the Greens and the FDP were referred to the relevant committees after a long debate. On the same day, the minister presidents of the federal states in Berlin called for speed. In the meantime, it was uncertain whether the necessary majority in the Bundesrat existed, as it was reported that the Free Voters in Bavaria and the BSW in Brandenburg and Thuringia did not want to vote in favour of the change. On 13 March, it was announced that the Greens, CDU and SPD had reached an agreement. According to the compromise, 100 billion of the 500 billion special funds for infrastructure will go towards climate protection. Moreover, spending on civil defence, cyber security, intelligence services and aid to countries attacked in violation of international law will all be excluded from the debt brake.
  
  On 16 March, the Bundestag Budget Committee, which is primarily responsible for the application, met. It dealt with the motions from the CDU/CSU and SPD, the Greens and the FDP. In its recommendation for a resolution, the committee proposed the already-agreed legislative text of the CDU/CSU, SPD and Greens for a vote. However, the FDP's draft bill was to be rejected. On 17 March, the Federal Constitutional Court published several decisions on urgent petitions submitted by the AfD, The Left and the FDP or their MPs. The plaintiffs wanted the court to declare that the planning of the legislative procedure violated the plaintiffs' rights as members of parliament, as the speed of implementation did not do justice to the complexity of the matter. This would have halted the legislative process. The court dismissed the applications in summary proceedings as the potential disadvantage could not be sufficiently demonstrated. The decision in the main proceedings is still pending.
  
  On 18 March, the Bundestag met for its second special session. Before the debate began, Bundestag President Bärbel Bas (SPD) recalled the first free election in the GDR on 18 March 1990, after which the Bundestag rejected several motions to suspend the Rules of Procedure tabled by the FDP and the AfD. The debate centred not only on the SPD, CDU/CSU, and Greens' bill, but also on that of the FDP and a motion for a resolution by the BSW entitled "No to war-mongering – yes to diplomacy and disarmament".
  
  The SPD parliamentary group leader Lars Klingbeil called it a "historic decision" for Germany and Europe. CDU/CSU leader Friedrich Merz said a "paradigm shift in defence policy" was needed to continue to guarantee Europe's security. Green parliamentary group leader Britta Haßelmann accused Merz of party tactics, as he had ruled out debt during the election campaign. Nevertheless, she was pleased with the compromise. The FDP party leader Christian Lindner accused the new government of "unrestrained debt creation". The AfD and The Left also criticised Merz and the legislative process.
  
  In the end, the majority of the CDU/CSU, SPD and Greens voted in favour of the motion, with a total of 512 MPs voting in favour and 212 against. The amendment to the Basic Law was thus passed. The vote was hailed as a victory for Friedrich Merz and a significant step toward changing the Basic Law to allow for greater flexibility in defence and infrastructure spending. With the Bundestag's approval by a two-thirds majority, the proposed changes moves to the Bundesrat, where it requires approval by a two-thirds majority for full enactment. NATO Secretary General Mark Rutte and EU Commission President Ursula von der Leyen welcomed the decision.
  
  Also on 18 March, the Free Voters, who are in government with the CSU in Bavaria, announced that they would vote in favour of the law in the Bundesrat. As such, a two-thirds majority in the Bundesrat was considered certain. On 21 March, the Bundesrat voted in favour of the amendment 53-16, passing the two-thirds threshold to become law. The states of Brandenburg, Saxony-Anhalt, Thuringia, and Rhineland-Palatinate all abstained from voting, which was counted as voting in opposition.
  
  In several states (North Rhine-Westphalia, Baden-Württemberg, Bremen, and Hesse), the FDP state parliamentary groups have announced that they will appeal to the state constitutional courts against their state governments' approval of the law. The applications were all rejected as they were inadmissible. On the one hand, the state government is responsible for representing and voting for a state in the Bundesrat. This means that it alone can vote on its voting behaviour. Secondly, an individual parliamentary group is not authorised to assert the rights of a state parliament; only the state parliament itself can do this.
  
  On 21 March, the Federal Constitutional Court dismissed another urgent application by the AfD to prevent the Bundesrat from meeting. The session was opened by Bundesrat President Rehlinger with a memorial speech in honour of the late Bundesrat President and Minister President Bernhard Vogel. The meeting then moved directly to the planned legislative amendments: In his speech, Baden-Württemberg's Minister President Winfried Kretschmann praised the extension of the 500 billion infrastructure package to include climate protection. He said: "More climate protection is a core task of this century." Nevertheless, he lamented a "feeling of disruption" due to the rapid legislative process.
  
  Bavaria's Minister President Markus Söder called for the money from the infrastructure package to be distributed and utilised sensibly. He said it is "not a self-service shop for any projects". He also called for a long-term repayment plan. Regardless of party affiliation, almost all speakers welcomed the easing of the debt brake for the federal states and called on the federal government to significantly speed up the planning and award procedures for contracts from the infrastructure package and to quickly pass the necessary implementation laws in order to eliminate the "ailing infrastructure" and the "investment backlog" (both terms used by several speakers) as quickly as possible. Bremen's head of government Andreas Bovenschulte said: "What use is the most beautiful special fund if we can't manage it in practice?"
  
  In the end, all federal states except Brandenburg, Rhineland-Palatinate, Saxony-Anhalt and Thuringia voted in favour; the others abstained. The reason for this was the disagreement between the coalition partners. While the CDU and SPD each wanted approval, the BSW and FDP wanted the proposal to be rejected. In such cases, the state abstains. President Frank-Walter Steinmeier signed the law on 22 March.