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Budget Committee

The Budget Committee is regarded as the most powerful committee since it decides de facto on the apportionment of budget funds. Each year the Budget Committee considers the draft federal budget for the coming year as well as any supplementary budgets or budgetary amendments submitted by the Federal Government. The decisions of the Budget Committee require the approval of the Bundestag, but this is forthcoming in virtually every case.

In the Budget Act, certain decisions on the execution of the federal budget are regularly left to the Budget Committee: for example, at the request of the Federal Finance Minister, it decides whether in certain cases appropriated funds on which it has imposed a qualified freeze may in fact be spent.

The Budget Committee not only considers the annual budget; it also has the right to scrutinize and to be consulted on all laws which involve expenditure (so-called finance bills). If a bill will have an impact on the budget, i.e. if it will give rise to new expenditure or to a cut in revenue, the Budget Committee assesses whether it and the measures it proposes are compatible with the overall budgetary situation. If it decides that this is not the case, and is confirmed in its view by the Bundestag, the bill has to be dropped. Examination of such bills by the Budget Committee is intended where possible to prevent the Federal Government from exercising its rights under Article 113 of the Basic Law. In accordance with this article, the Federal Government is able to prevent the entry into force of laws which will raise expenditure or cut revenue. It may also request the Bundestag to reconsider any bills it deems financially unjustifiable. The Federal Government has in fact never made use of these rights. In practice, ways to provide cover for new expenditure or to make up for losses in revenue are discussed by Members of the Bundestag and representatives of the Federal Finance Ministry during the Budget Committee's deliberations on the bill in question.