Germany’s Bundestag, or lower house of the Parliament, passed a supplementary budget and approved an additional 60 billion euros (72 billion U.S. dollars) in debt.
The supplementary budget would provide “massive financial support for society as a whole,” said Minister of Finance Olaf Scholz during his speech in the Bundestag.
According to a government statement, the additional debt would allow a record of around 240 billion euros in loans this year to finance the “enormous burdens” caused by the COVID-19 crisis.
“It is about moving forward, overcoming the pandemic,” said Scholz, stressing that funds were also allocated for health protection and as state aid for companies and employees in the country.
The COVID-19 pandemic and the virus variants were still having a “significant impact on the economy and society,” the government statement read. The additional budget is needed to create the “necessary financial framework” to counter the pandemic and its consequences.
With this supplementary budget, Germany’s total federal budget for 2021 now reached 547.7 billion euros, almost 50 billion euros more than originally estimated, according to the government.
Calculations published by the German Economic Institute (IW) in mid-April indicated that the German federal, state and local governments would take on an estimated 650 billion euros in new debt between 2020 and 2022 in the course of the COVID-19 crisis.
And the figure could be even higher “depending on what happens in the coming weeks and months,” said IW Director Michael Huether in a statement. (1 euro = 1.21 U.S. dollars)