100 billion for infrastructure: is the aid really getting there?
Federal Cabinet approves special fund of 100 billion euros for infrastructure and climate protection to strengthen municipalities.
100 billion for infrastructure: is the aid really getting there?
The Federal Cabinet has approved a bill for a special fund worth 100 billion euros that is intended to strengthen infrastructure and climate protection in Germany. This special fund is part of a broader plan that includes a total of 500 billion euros to promote the ability of states and municipalities to act. [Süddeutsche] reports that this measure is seen as a response to the existing deficiencies in public infrastructure such as broken roads, dilapidated bridges and slow internet, which have arisen from insufficient investment over the last decade.
The intended funds will be invested in essential areas such as transport infrastructure, education, civil protection, hospitals, digitalization and energy infrastructure. The draft law still needs to be approved by the Bundestag and Bundesrat, which is considered a crucial step for the implementation of the plan. Investments must begin after January 1, 2025 and can be approved until the end of 2036.
Criticism of the distribution of funds
A spokesman for Federal Finance Minister Lars Klingbeil emphasized that the states can decide for themselves how to distribute the funds. However, the construction industry expressed doubts about the removal of the “additionality” of the investment measures, indicating uncertainty about the impact of the new regulations.
Framework conditions and further measures
The special fund is not just limited to the 100 billion euros for the states and municipalities. It also includes 100 billion euros for the climate and transformation fund and 300 billion euros for additional federal investments. It is planned that the funds can be approved over a period of twelve years. Almost 19 billion euros from the federal share have already been planned for 2025, which, together with the funds for the climate and transformation fund and investments by the states and municipalities, amounts to around 37 billion euros.
The federal government has also announced measures for budget consolidation. These include growth promotion and additional savings measures, including reforms in basic security as well as savings in personnel and support programs. In order to monitor successful investments, annual performance checks after four and eight years as well as a final check after the end of the term of the special fund are planned.
Overall, it remains to be seen how the special fund will be implemented and whether the critics' concerns can be seriously taken into account. [Federal government] emphasizes that the measures are aimed at promoting Germany's modernization, securing prosperity and strengthening competitiveness.