Scholz and German opposition spar in debate over proposed budget

German Chancellor Olaf Scholz vowed on Wednesday that his government would fight so that young people can count on receiving a "stable" income in retirement as he presented the 2025 budget proposal.

"The fact that we want to guarantee a stable pension level in Germany is one of the major plans of this government," said Scholz during the debate on his coalition's proposed budget in parliament.

Opposition leader Friedrich Merz of the centre-right Christian Democrats (CDU), however, blasted the budget and accused Scholz's government of damaging the free market.

"The social budget is exploding," Merz charged during the debate in Berlin.

Merz contended that Scholz's coalition has broken any consensus between older and younger generations, and is making social policy unilaterally on the backs of younger citizens who will have to pay the bill.

Only strict limits on deficit spending backed by the CDU have prevented "an explosion in national debt" under Scholz's government, Merz claimed.

"You are worsening the competitive conditions for the German economy with every decision you make in your coalition," Merz said. "We are moving more and more in the direction of a planned economy."

The chancellor, however, championed pension commitments in the budget, saying that 17-year-olds in the country, who are now leaving school and will be paying pension contributions for five decades, need to know what they can rely on in the future.

"The most important asset that many in our country have is their pension entitlement, their pension insurance," he added.

Scholz also promised to do everything in his power to support families and to push ahead with the expansion of all-day childcare and daycare centres.

The government is spending billions of euros on those efforts, he said.

The chancellor further emphasized that he wants to offer senior citizens people more flexibility by allowing them to work into older age if they so desire.

The CDU's Johann Wadephul also criticized funding for Germany's military in the budget, which increased modestly but fell far short of what Defence Minister Boris Pistorius had requested.

Wadephul said it also falls far short of what's needed to rebuild Germany's defence capabilities and live up to Scholz's 2022 pledge for a turning point in German defence policy in the wake of Russia's full-scale invasion of Ukraine.

That chatter from Scholz is turning out to be a "cheap cliché," Wadephul said.

High inflation means the modest military funding increase is in reality a cut, Wadephul said: "You are taking funds away from the Bundeswehr instead of giving it the necessary resources for the turnaround."