German budget committee approves record 2027 spending plan

Overview

Updated 1 hour ago

Germany's budget committee approved €560.9 billion in federal spending for 2027 early Friday, after a session that ran about 16 hours. The plan borrows €210.4 billion across all funds, the second-highest total in the country's post-war history.

More than half the new debt goes to security and defence, with the defence ministry's budget reaching roughly €110 billion. Chancellor Friedrich Merz's coalition of conservatives and Social Democrats must still pass the plan through parliament.

Why it matters

Germany plans to borrow €210 billion in 2027, with more than half for defence and security, a debt-funded bet on rearmament and economic revival.

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Key Indicators

€560.9B

Total federal spending, 2027

About €5.5 billion more than the government's original draft.

€210.4B

New borrowing, all funds

Second only to the €215.4 billion borrowed in 2021 during the pandemic.

€123B

Core budget net new borrowing

Excludes borrowing under special funds for infrastructure and the military.

€110B

Defence ministry budget

The second-largest single ministry budget after labour and social affairs.

Forecast GDP growth, 2027

Projection from Germany's Council of Economic Experts.

Voices

Curated perspectives — historical figures and your fellow readers.

People Involved

Friedrich Merz

Chancellor of Germany

Leading a coalition with falling personal approval ratings

Lars Klingbeil

Federal Finance Minister

Presented the budget; criticised for relying on off-budget funds

Christian Haase

CDU budget policy spokesman

Defended the budget in committee

Thorsten Rudolph

SPD member, budget committee

Open to further tax relief, with conditions

Sebastian Schäfer

Greens budget lawmaker

Critic of the budget's accounting

Dietmar Bartsch

Left party budget lawmaker

Opposition critic

Boris Pistorius

Federal Defence Minister

Oversees roughly €110 billion defence budget

Organizations Involved

Bundestag Budget Committee

Parliamentary committee

Approved the 2027 budget; sent it to the full parliament

The parliamentary committee that reviews and amends the federal budget before the full Bundestag votes.

Christian Democratic Union / Christian Social Union (CDU/CSU)

Political party bloc

Senior coalition partner

Germany's centre-right conservative bloc, led by Chancellor Friedrich Merz.

Social Democratic Party (PSD)

Political party

Junior coalition partner

Germany's centre-left party, the junior partner in the governing coalition.

Timeline

2025 November 2026

3 events Latest: Today

November 2026
Budget committee approves 2027 spending plan
Today Legislation

After about 16 hours, the committee backs €560.9 billion in spending and €210.4 billion in new borrowing.
Today
Coalition drops plastic tax, delays sugar tax
Negotiation

Coalition leaders scrap a packaging tax, delay a sugary-drinks levy to 2028 and roll back child benefit cuts.
2 days ago
2025
Coalition eases borrowing limits for defence
Policy

Germany agrees to relax debt rules on defence spending, opening the door to higher military borrowing.
2025

Scenarios

Parliament passes the budget as approved

Likely Resolves by Dec 18, 2026

Discussed by: Coalition lawmakers and Reuters

The full Bundestag votes on the plan the committee approved, adopting €560.9 billion in spending and €210.4 billion in new borrowing. Coalition lawmakers have defended the package as a balance between defence, investment and welfare.

Coalition adds electricity tax cut before final passage

Possible Resolves by Dec 18, 2026

Discussed by: CDU budget lawmaker Christian Haase and Reuters

The coalition committee agrees next week on €5 billion in financing for an electricity tax cut, and the Bundestag adopts an amended budget. SPD lawmaker Thorsten Rudolph has said any relief must not be financed with new debt.

Budget stalls or is substantially rewritten

Unlikely Resolves by End of 2026

Discussed by: Opposition lawmakers and fiscal critics

Criticism from the Greens, The Left, the federal audit office and economists over off-budget accounting grows, and the coalition fails to hold its majority for the plan. This would force a rewrite or a new committee session.

Historical Context

2 moments from history that rhyme with this story — and how they unfolded.

2021

COVID-19 emergency borrowing (2021)

Germany borrowed €215.4 billion in 2021 to fund pandemic relief, the highest single-year total in its post-war history. The debt financed short-time work subsidies, health spending and business aid.

Then

Deficits and debt rose sharply as the economy contracted during lockdowns.

Now

The 2021 record became the benchmark against which later borrowing is measured.

Why this matters now

The 2027 plan's €210.4 billion in new borrowing is the second-highest total since World War Two, just below the 2021 record.

2025

Debt brake easing for defence (2025)

Germany agreed to relax its constitutional borrowing limits for defence spending, allowing military outlays above a set threshold to escape the debt brake. The change followed pressure to rebuild the Bundeswehr after decades of underinvestment.

Then

Defence spending rose and special funds for the military were expanded.

Now

The reform made large-scale defence borrowing politically and legally easier.

Why this matters now

The 2027 budget's defence-heavy borrowing rests on this 2025 change, which lets military spending bypass normal debt limits.