German budget committee approves record spending plan for 2027

Germany's parliamentary budget committee approved a record €560.9 billion ($620.3 billion) spending plan for 2027 early on Friday, although the budget still faces a final vote and a proposed electricity tax cut remains unresolved.

The committee approved the draft following last-minute changes, paving the way for the government to spend more money next year than ever before.

The budget includes almost €123 billion in new borrowing, around €4 billion more than initially proposed by the government.

Additional debt-funded investments in infrastructure and the armed forces are expected to push total new borrowing above €200 billion.

However, Chancellor Friedrich Merz's governing coalition has yet to find the money needed to finance a broader cut in electricity taxes.

The proposed measure, which is part of the coalition agreement between Merz's conservative bloc and the centre-left Social Democrats (SPD), would cost around €5 billion but provide households with only modest savings of a few euros per month.

The coalition is expected to discuss the issue at a meeting on Tuesday, with the tax cut potentially being added to the budget before its final approval.

The Bundestag, Germany's lower house of parliament, is due to vote on the budget during its November 24-27 session.

The budget sets out how much each ministry can spend in 2027 and which projects will receive funding.