A pact for Germany is to make the country more flexible, modern and secure

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The Federal Chancellor in a general debate A pact for Germany is to make the country more flexible, modern and secure

“Speeding up instead of standing still, taking action instead of waiting things out, cooperation rather than quarrels” – in his speech during the general debate in the German Bundestag, Federal Chancellor Scholz suggested a pact for Germany. He also pointed out that following a number of years of crises, the 2024 federal budget reflected a state with a sound financial basis.

Federal Chancellor Scholz (wearing an eye patch) during a speech on the 2024 budget in the Bundestag.

A soundly financed state: Federal Chancellor Scholz speaks about the 2024 budget in the Bundestag.

Photo: Federal Government/Kugler

In his speech during the general debate on the budget in the German Bundestag, Federal Chancellor Olaf Scholz said that too much had been put on the back burner in recent years: “The citizens have had enough of this standstill, and so have I”.

Tackling things together

Mastering these challenges was a “national effort”, which was why he wanted to invite all federal, state, and municipal powers to join a pact for Germany that would make the country more flexible, modern and secure, Scholz said in his speech. He called on policy makers to join forces and tackle things together. “Today we are laying the foundations for our country’s prosperity and stability ten, twenty or thirty years from now,” Scholz stressed.

The pact for Germany is to address the areas in which citizens are expecting progress most urgently:
- Energy supply that must be clean, secure and affordable
- Construction of new housing
- Modernisation and digitalisation of infrastructure
- Corporate competitiveness
- Quick and efficient digital administration

Further information about the pact for Germany is available here.

Investments totalling several billions

Nobody could be satisfied if there was no economic growth in Germany, the Federal Chancellor pointed out, adding that “structural problems can only be solved with structural solutions”. Planning and construction processes are to be sped up, and 54 billion euros have been earmarked for better railway lines, new bridges, faster internet, charging stations, social housing, and climate-neutral economic activity. The climate and transformation fund includes 58 billion euros for the hydrogen economy, the semi-conductor industry, clean energy, climate-friendly mobility, digital infrastructure, and building refurbishments. A total of over 110 billion euros are available for climate protection and modernising the business world.

“International companies from future-oriented industries such as biotechnology, battery production, clean tech, climate-neutral steel, and artificial intelligence are investing over 80 billion euros in Germany as a business hub.” Germany was in the process of becoming the most important European hub for semi-conductor production, and our prosperity was very closely linked to the European Union, the Federal Chancellor said. Calls for new barriers between the member states, for the European Union to be dismantled and for the welfare state to be radically reduced represented nothing but a wilful destruction of prosperity, the Federal Chancellor cautioned.

He went on to say that the economy could not manage without workers from abroad, and that the Skilled Workers Immigration Act had to be implemented energetically, while visas had to be granted more quickly. Fighting irregular migration remained important, nevertheless, and repatriation had to be handled more swiftly, he continued. 

Sound finances

48 million tax payers have more net income left over from their gross income, thanks to compensation for bracket creep. The child benefit increase means that a family with two children has 700 euros extra per year, while the child supplement is up to 500 euros higher. The highest increase in pensions in decades came into effect on 1 July. More than 30 years after the reunification, pensions are at long last on the same level in Eastern and Western Germany.

Germany had weathered the pandemic, responded determinedly to Russia's attack on Ukraine and had become independent of Russian energy within just a few months as a result, Scholz said, adding that “we are making progress in putting our country in a position where our best days are not in the past but are yet to come”. Societal cohesion was a key requirement for making sure that nobody is left behind on the path towards our country’s future, Scholz stressed, and he continued by saying that “after three extraordinary years of crises the 2024 federal budget reflects our return to normality and a state with a sound financial basis”.