The Minister of Finance for Baden-Württemberg, Danyal Bayaz of the Green Party, is advocating for a comprehensive reform program to complement the German government’s recently approved financial package. Speaking on the Capital economics podcast, Bayaz emphasized that sustainable growth cannot be achieved through financial investment alone but requires fundamental structural improvements.
Bayaz argued that the special fund of €500 billion, which previously received support from the Green Party, is insufficient on its own. While acknowledging the special fund’s importance, he stressed the necessity of accompanying reforms addressing key areas such as retirement provisions, healthcare and bureaucratic processes, stating there is “still room for improvement.
He expressed concern that the government is utilizing the special fund as a means of temporarily addressing budgetary issues, citing recent decisions regarding commuter benefits and the “mother’s pension” as examples of measures seemingly drawn from the fund without directly aligning with its intended purpose. Bayaz believes the current coalition government possesses the capacity for action and warns that the impetus for reform should not dissipate.
Furthermore, Bayaz voiced his perspective on the financial package approved in March, which included a relaxation of Germany’s debt brake to facilitate defense spending. He suggested that stronger safeguards were needed to prevent ministries from diverting the funds for purposes outside the original intent. He advocated for a more ambitious approach to the debt brake exception, suggesting levels closer to 1.5 or even 2 percent of Germany’s gross domestic product would have been preferable for defense-related spending.
