GERMANY: RTRS-Bundestag To Start Debt Brake Reform Talks 13 Mar, Vote On 18 Mar

Reuters reports the Bundestag will begin discussions on the proposed reform to the debt brake to allow for greater defence spending on Thursday, 13 March, with the eventual vote taking place on Tuesday, 18 March. The discussions will take place in the 'old' pre-election Bundestag, where the conservative Christian Democratic Union/Christian Social Union (CDU/CSU), centre-left Social Democrats (SPD) and environmentalist Greens hold a two-thirds majority and, therefore, can enact constitutional reforms without outside support. 

• With the reforms seen as likely to pass (even if there are some holdouts within the fiscally conservative wing of the CDU/CSU), they will then go to the upper house of Germany's Parliament, the Bundesrat. The CDU/CSU, SPD, and Greens also hold a majority in that chamber, meaning it should pass before the new Bundestag is convened on 25 March.
• The CDU/CSU and SPD, which are likely to form the next gov't, want to get the reforms passed before the new Bundestag convenes. After that point, the far-right Alternative for Germany (AfD) and far-left Die Linke will hold a 'blocking minority' of one-third of the seats. AfD has come out against such reforms outright. Linke supports a full removal of the debt brake but is strongly opposed to increased defence spending and, therefore, could scupper the provisions of the deal outlined by CDU leader and chancellor-in-waiting Friedrich Merz. 

For a round-up of analyst views on the proposed debt brake reform and infrastructure fund, please see the PDF below: