The rate of public expenditure in Germany is nearly 50% due to welfare costs

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The rate of public expenditure in Germany is nearly 50% due to welfare costs

There are many European banknotes on the table. An independent panel of experts warned that Austria’s budget crisis was more severe than previously assumed. Daniel Reinhardt/DPA

The country’s statistical office Destatis said on Friday that the ratio of public expenditure in Germany, tracking government spending on GDP, rose to 49.5% in 2024 due to increased welfare and social spending.

The agency said in a press release that the quota increased by 1.1 percentage points from 2023, while the score was 2.2 percentage points higher than the long-term average since 1991.

Public expenditure ratios are used to measure state expenditures related to a country’s overall production.

In the years after the unification in 1995, Germany’s public spending ratio reached its highest level, when that number soared to 55.2% as the government took over Treuhand’s debt, an institution privatized the East German company before the unification.

The rate has also soared to similar highs during the coronavirus pandemic, reaching 51.1% in 2020 and 50.7% in 2021 as government spending increases spending on Covid-19-19 testing and vaccines and keeps businesses down in lockdown.

Germany had the lowest public expenditure ratio in 2007, accounting for 43.5%.