Currently, the state parliament of North Rhine-Westphalia is examining whether to include the debt brake in the state constitution. As from next year, according to the Grundgesetz the Federal Government is not allowed to assume new debt. As of 2020, also the Laender are obliged to submit a balanced budget without facing new debt. In any case, the debt brake applies to the Länder. However, by including the debt brake into the state constitution many detailed issues could be clarified. Half of the federal states, among them Bavaria, Hesse or Saxony, have already taken this step. In his statement at the state parliament of North Rhine-Westphalia, IMFS Professor Siekmann pointed out the loopholes in the legal framework as well as possible consequences.
IMFS Working Paper No. 98
"Stellungnahme für die öffentliche Anhörung der Verfassungskommission des Landtags Nordrhein-Westfalen zur Schuldenbremse"
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