FRANKFURT, April 11 (Reuters) - A planned reform of Germany's cap on public borrowing will not take place during the government's current legislative term, German mass tabloid Bild reported on
German debt brake reform won't happen during current government term, Bild reports
Stalled Reform of Germany's Public Borrowing Cap
Commission Deadlock and Delayed Reform
FRANKFURT, April 11 (Reuters) - A planned reform of Germany's cap on public borrowing will not take place during the government's current legislative term, German mass tabloid Bild reported on Saturday, adding members of the responsible commission have failed to find common ground.
The paper, citing commission sources, said members were now meeting only as a formality, adding a final meeting was planned for May and that the body would subsequently present a non-binding proposal of ideas, rather than a full reform.
Government Response
A German government spokesperson declined to comment on the report.
Background on the Debt Brake and Reform Efforts
Coalition Agreement and Expert Commission
The government included in its coalition agreement the establishment of an expert commission to develop a proposal for modernising the debt brake nL5N3UY0JK, which restricts public borrowing in Europe's biggest economy to 0.35% of gross domestic product.
Implications of the Reform
The reform would mark a rollback of the borrowing rules imposed after the 2008 global financial crisis that many now say are outdated and keep Germany in a straitjacket. The government is pursuing a massive spending splurge to revive the economy and boost defence spending.
Commission Timeline and Expectations
The commission, which only started work nL5N3UY0JK in September, was initially expected nL5N3QN1JA to facilitate a debt brake reform by the end of 2025.
Reporting Credits
(Reporting by Christoph Steitz; Editing by Emelia Sithole-Matarise and Jan Harvey)
