Policy Article
The Kiel Federal Expenditure Monitor 2024: An empirical structural analysis of the federal budget
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Fiscal Policy & National Budgets
Germany
Economic Policy in Germany
In the Kiel Federal Expenditure Monitor 2024, federal expenditure is presented according to a functional classification scheme. Following this scheme, around two thirds of the federal budget for 2024 will be spent on correcting income distribution, federal financial aid and legacy burdens. Social spending and spending on redistribution bureaucracy amounting to EUR 212 billion will account for 35.4 percent of federal spending in 2024. The second largest block of expenditure is federal financial assistance, i.e. expenditure subsidies provided by the federal government, amounting to EUR 127.3 billion or 21.3 percent of total federal expenditure. Other expenditure categories include federal expenditure on external and internal security, which is more narrowly defined in the Monitor, at EUR 68.4 billion, and research outside of companies at EUR 14 billion. This empirical finding shows that, despite all efforts, spending on external and internal security and on promoting Germany's international competitiveness has not yet been given any particular political priority. On the other hand, spending priorities in the areas of social affairs and financial aid have continued to gain in importance.
