Rules of Procedure for the Stability Council

Section 1 – Members and representation

(1) The Stability Council is comprised of the Federal Minister of Finance, the Länder ministers responsible for finance and the Federal Minister of Economics.

¹ The designation “Länder ministers” in these rules of procedure includes the senators of the city-states of Berlin, Bremen and Hamburg.

(2) Each member shall appoint as a permanent deputy a minister or a state secretary² from the member’s own ministry.

² The designation “state secretary” in these rules of procedure also includes the state counsellors (Staatsräte) of the Free Hanseatic City of Bremen and the Free and Hanseatic City of Hamburg.

Section 2 – Chair

(1) The Federal Minister of Finance and the chair of the Finance Minister Conference jointly chair the Stability Council.

(2) In the event that the Federal Minister of Finance is unable to attend a meeting, he or she is represented as co-chair of the Stability Council by the Federal Minister of Economics. If the Federal Minister of Economics is also unable to attend, he or she is represented by the permanent deputy of the Federal Minister of Finance.

(3) In the event that the chair of the Finance Minister Conference is unable to attend a meeting, he or she is represented as co-chair of the Stability Council by the deputy chair of the Finance Minister Conference. If the deputy chair of the Finance Minister Conference is also unable to attend, he or she is represented by the most senior Land finance minister in attendance.

(4) The two chairs alternate annually. The change of chair takes place mid-year.

Section 3 – Accompanying persons and guests

(1) The members of the Stability Council may be accompanied by one person. In the event that the member and the member’s permanent deputy are unable to attend, the accompanying person may attend without speaking or voting rights.

(2) The Stability Council may decide to discuss certain points without accompanying persons present.

(3) The Stability Council may call in guests for discussion of individual agenda items.

(4) One person from the Federal Ministry of Finance division responsible for the projection of the general government budget and one person from the central data office of the Länder finance ministries (Zentrale Datenstelle der Landesfinanzminister) attend the meetings as guests.

Section 4 – Assembly

(1) The chair who presides at the meeting in accordance with section 2 (4) convenes the Stability Council.

(2) The Stability Council meets on an as-needed basis, but at least twice a year.

(3) The Stability Council must also be convened if at least five members request a meeting; these members must specify the subject of discussion.

(4) Stability Council members must receive written invitation to meetings at least two weeks before the meeting date, with notification of the agenda, time and location of the meeting. Discussion documents must be provided to the members of the Stability Council in due time prior to meetings.

Section 5 – Confidentiality and privacy

The deliberations of the Stability Council are confidential and not public.

Section 6 – Decisions

(1) To be passed, Stability Council decisions require the vote of the Federation and a majority of two-thirds of the Länder.

(2) The vote of the Federation is be cast by the Federal Minister of Finance.

(3) In the case of decisions affecting individual Länder, the affected Land is not entitled to vote. With these decisions too, at least 11 Land votes are required to obtain a two-thirds majority of the Länder.

(4) Notwithstanding subsection (1), decisions affecting the Federation require a majority of two-thirds of all voting members to be passed.

(5) Decisions may be passed by written procedure. An ongoing written procedure may be cancelled at the request of at least five members. In this case, a meeting must be convened.

Section 7 – Publication of decisions and discussion documents

The Stability Council’s decisions and the discussion documents on which they are based are published. In particular, this includes:

• submitted budgetary figures, reports by the government entities, and Stability Council conclusions as per section 3 of the Stability Council Act (Stabilitätsratsgesetz),
• reports on the review of impending budgetary emergencies and Stability Council conclusions as per section 4 of the Stability Council Act,
• adjustment programmes, reports by government entities on compliance with adjustment programmes, and Stability Council conclusions as per section 5 of the Stability Council Act,
• decisions pertaining to the monitoring of compliance with the constitutional debt rule as per section 5a of the Stability Council Act,
• decisions pertaining to the monitoring of compliance with the upper limit on the general government structural deficit and to the coordination of budgetary and fiscal planning as per section 51 of the Budgetary Principles Act (Haushaltsgrundsätzegesetz) and section 6 (3) of the Stability Council Act.

Section 7a – Advisory board

(1) The Stability Council is assisted in monitoring compliance with the upper limit on the general government structural deficit, as per section 51 (2) of the Budgetary Principles Act, by the advisory board established in accordance with section 7 of the Stability Council Act. The advisory board is independent in its activities.

(2) The discussion documents that the Stability Council Working Group prepares for proposed decisions pertaining to the monitoring of compliance with the upper limit on the general government structural deficit pursuant to section 6 of the Stability Council Act are made available to the advisory board. If necessary, additional information that the board requires for carrying out its tasks is provided by the Stability Council’s secretariat. The information made available to the advisory board must be handled confidentially.

(3) The chair of the advisory board or his or her deputy participates in the Stability Council’s deliberations regarding compliance with the upper limit on the general government structural deficit.

(4) The advisory board may make use of the secretariat for organisational matters.

(5) The advisory board’s statements and recommendations are published on the Stability Council’s website following Council meetings.

(6) Within the context of its reviews under section 6 of the Stability Council Act, the Stability Council always takes into account the advisory board’s assessments and recommendations as per section 7 (3) of the Stability Council Act and provides publicly available explanations in the event that any of its own assessments and recommendations differ from those of the advisory board. The same applies to cases covered by section 6 (3) of the Stability Council Act.

Section 8 – Committees

(1) A Stability Council Working Group will be established to prepare Stability Council meetings.

(2) Upon decision by the Stability Council, an evaluation committee will be established for the purpose of reviewing impending budgetary emergencies at a particular level of government as per section 4 of the Stability Council Act, as well as for the purpose of setting up an adjustment programme and monitoring the adjustment process as per section 5 of the Stability Council Act.

(3) The Stability Council may appoint additional committees.

Section 9 – Stability Council Working Group

(1) The Stability Council Working Group is comprised of representatives from the Federal Ministry of Finance, the finance ministries of the Länder and the Federal Ministry of Economics.

(2) The representatives of the Länder receive support from the central data office of the Länder finance ministries. The Stability Council Working Group may call in guests for individual agenda items. Representatives from the local authorities’ national associations and the Deutsche Bundesbank take part as guests in deliberations on the coordination of budgetary and fiscal planning described in subsection (5).

(3) In general, the Stability Council Working Group’s meetings are chaired in accordance with section 2 (4) of these rules of procedure.

(4) The Working Group submits to the Stability Council proposals for decisions on the individual agenda items of respective meetings, insofar as such proposed decisions are not prepared by the evaluation committee. In particular, the Stability Council Working Group submits proposals for Stability Council conclusions relating to regular budgetary monitoring as per section 3 of the Stability Council Act, for Stability Council decisions regarding compliance with the constitutional debt rule as per section 5a of the Stability Council Act, and for Stability Council decisions in connection with the monitoring of compliance with the upper limit on the general government structural deficit as per section 6 of the Stability Council Act. The discussion documents for proposed decisions in connection with the monitoring of compliance with the upper limit on the general government structural deficit as per section 6 of the Stability Council Act include:

• a projection by the Federal Ministry of Finance on fiscal, budgetary and aggregate trends for the period covered by the medium-term fiscal plan (current year and the four years thereafter), containing figures for all government levels – general government, Federation, Länder, local authorities and social security funds – relating to the general government deficit, debt ratio and other aggregate financial indicators,
• an updated projection of Länder budgets from the perspective of the Länder,

and once a year, as a supplement,

• a description of the new measures contained in the Federal Ministry of Finance’s projection and their medium-term fiscal impact,
• a scenario, based on a no-policy-change assumption, that shows how the projection would play out for the general government, the Federation and the social security funds if these measures were not taken,
• an estimate of the impact that the new measures will have on the long-term sustainability of public finances.

(5) To coordinate the budgetary and fiscal planning of the Federation, Länder, local authorities and associations of local authorities as per section 51 of the Budgetary Principles Act, the Stability Council Working Group holds an additional meeting in summer to discuss forecasts for short- and medium-term trends in public budgets. For this purpose, the Federation provides an updated projection of the general government budget, broken down by governmental levels, and the Länder provide an updated aggregate projection of Länder budgets.

(6) Section 6 applies accordingly.

Section 10 – Evaluation committee

(1) In principle, the evaluation committee is comprised of one state secretary from the Federal Ministry of Finance and four state secretaries from Länder finance ministries. The composition of the evaluation committee is determined by Stability Council decision and can vary depending on which government entity is affected. The evaluation committee meets on an as-needed basis. In general, the affected government entity participates in evaluation committee meetings. .

(2) The evaluation committee provides the Stability Council with a report on the findings of its review as per section 4 (2) of the Stability Council Act, along with a proposal for a decision. The affected government entity is given the opportunity to submit its own statement.

(3) If the Stability Council determines that the Federation or a Land is at risk of a budgetary emergency pursuant to section 4 (5) of the Stability Council Act, the evaluation committee reviews the adjustment programme proposed by the affected government entity, coordinates the details of the programme with the government entity in question and submits a proposal for a decision to the Stability Council.

(4) The evaluation committee monitors the affected government entity’s adjustment process. It regularly reviews the implementation of the adjustment programme. It provides the Stability Council with an assessment and a proposal for a decision in this regard.

(5) To be passed, decisions by the evaluation committee require the vote of the Federation and at least two Länder.

Section 11 – Secretariat

(1) A secretariat will be established to assist the Stability Council and its committees.

(2) The secretariat is jointly headed by one representative from the Federal Ministry of Finance and one representative appointed by the Finance Minister Conference.

(3) The secretaries attend the meetings of the Stability Council and its committees.

Section 12 – Reports to the Stability Council

(1) Annual reports from the respective government entities serve as the basis for the Stability Council’s regular budgetary monitoring as per section 3 of the Stability Council Act.

(2) In general, the Federation and the Länder submit their reports by mid-October at the latest.

(3) Actual figures relating to the current budgetary situation are based on official government financial statistics. The government entities provide the secretariat with updated information on budget targets for the current fiscal year by the end of April.

(4) The secretariat compiles figures relating to the current budgetary situation based on the current fiscal year and the two previous years and sends these figures, together with standardised assumptions for calculating projections of medium-term budgetary trends, to all Stability Council Working Group members by the end of May.

(5) The standardised assumptions for calculating projections of medium-term budgetary trends are agreed upon during the May meeting of the Stability Council Working Group.

Section 13 – Minutes

(1) For every meeting of the Stability Council and its committees, the secretariat keeps minutes summarising the main points of the discussion. The minutes are to be provided to the members of the Stability Council and/or its committees before their respective next meetings.

(2) The minutes are deemed to be approved if no objections are raised before the meeting following their distribution.