German government plans to forgo parliamentary pay raise, announces new fighter jet initiative after FCAS collapse

The CDU/CSU and SPD parliamentary groups plan to introduce a bill this week to forgo the annual pay raise for Bundestag members, a move intended to send a signal of austerity amid strained public finances. The bill has been placed on the parliamentary agenda for late Thursday.

The pay raise, which is tied to wage developments through an automatic mechanism in the Abgeordnetengesetz (Members of Parliament Act), would have increased monthly salaries for the 630 lawmakers from about 11,833 euros to 12,330 euros on July 1 — a rise of 497 euros per month per lawmaker. The draft bill provides for a one-time deviation from that automatic adjustment.

"In the tense budget and economic situation, structural reforms are necessary that will also involve burdens for citizens," the governing factions said in a statement. "It is a requirement of credibility and responsibility that, in this situation, members of parliament also make an additional contribution to the necessary savings." Even though nominal wages rose by 4.2% last year, the statement said, the parliamentary allowances should exceptionally not be increased this year.

The Greens, AfD, and Left party also oppose the increase, ensuring a majority for the bill.

Separately, several German defense companies led by Airbus are set to sign a letter of intent on Wednesday in Berlin to jointly develop a new fighter jet, following the collapse of the Franco-German FCAS (Future Combat Air System) project. The group includes MTU, Hensoldt, Diehl, Liebherr, Autoflug, and MBDA, the European conglomerate that manufactures the Taurus cruise missile.

The FCAS project ended on Monday after Chancellor Friedrich Merz recommended to French President Emmanuel Macron not to continue. France, however, signaled it still sees cooperation with Germany as necessary. "France remains of the view that Franco-German cooperation is necessary for our two countries as well as for European partners in the area of defense and security," the Élysée Palace said Monday. Paris also criticized the lack of a joint communication strategy and that the third project partner, Spain, had been completely bypassed.

Spanish Defense Minister Margarita Robles on Tuesday called the end of FCAS a "failure of EU security and defense policy." The project's termination was "bad, very worrying news for Europe and for Europe's strategic autonomy," she said, adding that industrial interests had been placed above Europe's security and defense interests. Spain needs a sixth-generation fighter jet and will do everything in its power to find another solution, Robles said. According to press reports, Spain is now considering cooperation with Sweden or Turkey for a sixth-generation fighter.

German Defense Minister Boris Pistorius expressed disappointment over the project's failure. "It hurts me a lot," the SPD politician said in Berlin. "Every Franco-German project that is not successful is one that I do not like, because I know how important Franco-German cooperation is in Europe." Pistorius said no agreement was reachable between Dassault and Airbus. "Here, no agreement was reachable anymore," he said. "Both Friedrich Merz and I spoke with Dassault and with Airbus, intensively, bilaterally, multilaterally. Macron tried on his part. The decisive hurdles could not be overcome — or were not to be overcome by the industry."

In other developments, the National Security Council, chaired by Chancellor Merz, decided on Monday evening to review the supply and precautionary laws (Sicherstellungs- und Vorsorgegesetze) and to establish an AI security institute. The council also assessed the implications of advanced AI models for German cybersecurity.

Separately, the number of left-wing extremist violent crimes rose by nearly 43% last year, according to data presented by Federal Interior Minister Alexander Dobrindt and BKA President Holger Münch in Berlin.