Germany's SPD Leader on Debt Brake Reform

BERLIN (Reuters) – The leader of Germany's Social Democratic Party (SPD), Lars Klingbeil, expressed optimism about reforming the nation's spending cap, known as the debt brake. He stated that the reform process could begin without waiting for the formation of a new government.

Klingbeil noted signs of willingness from the centre-right opposition and said, "That's a good starting point for continuing straight away," according to his comments in the Handelsblatt newspaper.

Opposition leader Friedrich Merz of the conservative Christian Democrats (CDU) indicated he might support reforming the debt brake, which restricts Germany's public deficit to 0.35% of GDP under certain circumstances. Merz is considered a potential successor to SPD's Olaf Scholz in upcoming snap elections scheduled for February 23, with the CDU currently leading in the polls.

Klingbeil asserted that reforming the debt brake does not necessitate waiting until a new government is in place. He emphasized the uncertainty regarding majorities in the Bundestag (lower house of parliament), stating, "We don't have to wait until there is a new government in April, May or June, when we don't even know whether we will have the necessary majorities in the Bundestag with a two-thirds majority."

Reforming the debt brake would require a two-thirds majority, as it is embedded in the German constitution.