Saleh Urges Senate to Take Action on Federal Billions Package

In a recent statement, the leader of the Social Democratic Party (SPD) parliamentary group has emphasized the critical role of the Berlin Senate in capitalizing on a significant federal credit program aimed at improving infrastructure, climate protection, and defense. The SPD's Raed Saleh highlighted the urgency for the Senate to devise a comprehensive plan for the allocation of these funds, expressing that the financial support is both timely and essential for the capital.

Saleh pointed out that while the federal government has opened the door to substantial financial aid, effective and sustainable management of these resources is paramount. He stressed the necessity for the Senate to have viable proposals ready to ensure that Berlin does not lag behind other federal states in securing its share of the funding.

According to Saleh, there will be fierce competition among states for the federal billions, and it is crucial for Berlin to present compelling projects. As the nation's capital, Berlin should prioritize its needs and collaborate closely with the parliament to maximize the benefits of this funding.

One of Saleh's key recommendations is to channel the federal funds into the housing sector, addressing the pressing issue of affordable housing in the city. He also mentioned the importance of investing in infrastructure, including the repair of roads and bridges, as well as enhancing rail connectivity, particularly regarding links to neighboring Poland.

The Bundestag has recently approved a constitutional amendment paving the way for this historic credit package, which still awaits confirmation from the Bundesrat. The ruling coalition in Berlin is expected to support the approval.

This substantial debt initiative consists of three main components: first, the relaxation of the debt brake for expenditures in defense, civil protection, intelligence services, and cybersecurity, allowing for new borrowing when spending exceeds one percent of the GDP; second, the establishment of a special asset fund, exempt from the debt brake, which could be bolstered by up to 500 billion euros to address the dilapidated infrastructure; and third, the provision for states to collectively incur debts equivalent to 0.35 percent of the GDP, lifting the previous prohibition on state borrowing.

While many details remain unresolved, preliminary calculations suggest that Berlin could receive approximately 500 million euros annually for infrastructure improvements over the next decade from the federal allocation. Additionally, the city may incur up to 675 million euros in new debt each year for its budget.

Saleh noted that this influx of investment presents a significant opportunity to stimulate economic growth and support long-term development in Berlin. However, he urged that funds must be deployed swiftly and efficiently. He expressed willingness for the parliament to facilitate this process, even proposing legislative measures to expedite procedures.

Furthermore, there is optimism that the anticipated financial support could alleviate the need for budget cuts previously agreed upon by the CDU and SPD, which stipulated reductions of 750 million euros for the fiscal years 2026 and 2027. Saleh is confident that a careful re-evaluation could yield some relief regarding these planned savings.