Right at the beginning of the budget week, at the end of which the Bundestag intends to adopt the budget for 2022, the representatives of the traffic light parties and the Union faction reached an agreement on the special debts (officially: special assets) for the Bundeswehr.

After feedback from the respective parliamentary groups, the Federal Ministry of Finance sent out the joint statement shortly before 11 p.m. on Sunday evening.

The central sentences are: “Together we will ensure that the Bundeswehr will be strengthened in the coming years with additional investments of 100 billion euros.

The so-called two-percent target of NATO will be achieved on average over several years.”

Manfred Schaefers

Business correspondent in Berlin.

  • Follow I follow

The necessary measures for cyber security, civil protection and the upgrading and stabilization of partners would be financed from the federal budget.

After the special fund has been used, the necessary funds to achieve "the then valid NATO capability goals" would continue to be made available.

The new debts to strengthen the Bundeswehr are taken on without the debt rule.

The Basic Law will be changed for this – which in turn requires the participation of the Union in order to be able to muster the necessary two-thirds majority in the Bundestag.

In the negotiations, this has ensured that the money from the “special fund” is only available for the Bundeswehr, as Chancellor Olaf Scholz (SPD) had announced.

Finance Minister Christian Lindner (FDP) also included it in a first draft law.

Later, instead of the word "armed forces", the words "alliance and defense capability" were used - at the request of the ranks of the Greens and SPD.

The fixing of the NATO target quota – on average over the years – was also important for the CDU and CSU.

Difficult sourcing

In the debate, there was mostly talk of five years in which the "special fund" should be used to strengthen the Bundeswehr militarily.

This period is reached indirectly if the NATO goal is to be achieved.

With an annual 50 billion euros from the core budget plus 20 billion euros from the special pot, roughly 2 percent of the gross domestic product is achieved.

Nevertheless, there is no time limit in the consensus paper.

Since large procurement projects by the Bundeswehr are associated with many risks and there have often been delays in delivery in the past, one probably did not want to tie oneself down too much.

A fixed repayment obligation has not been agreed - on the contrary, the cross-warehouse agreement leaves considerable leeway.

The last sentence reads: "After the claim, the repayment begins within a reasonable period of time." What does claim mean?

Does that mean full occupancy even if the word isn't there?

And can the next government simply not call off a small amount so that the special fund is not completely used up - so that you don't have to worry about the repayment yet?

The wording “reasonable period of time” is also very vague.

This also opens up many opportunities for the next government to postpone unpleasant decisions.

There are still open questions about the repayment

One reason why there was a reluctance to fix the repayment payments is probably the already considerable burden on the federal budget in the late 1920s.

The repayment obligation from the three crisis years 2020 to 2022 will add up to 10 to 13 billion euros annually from 2028 onwards.

The exact amount depends on the closing of this year.

This burden alone is in the magnitude of the new borrowing permitted under the debt rule.

If there is also a repayment obligation from the Bundeswehr special fund, the governing coalition will even have to generate surpluses.

Apparently, they didn't want to make that binding on Sunday.

Finance Minister Christian Lindner (FDP) therefore only calculated on Monday as a model: If you start repaying in 2028 and spread it over thirty years, you will get an amount of just over 3 billion euros that will be needed for this per year.

The repayments that have already been made and those that are still to be decided come at a time when spending on defense from the core budget has to be increased noticeably compared to today.

The unified paper no longer mentions a fixed quota for this period, but only promises to provide the funds for the NATO capability goals that will then apply.

As Minister Lindner explained, this could be 1.8 or 2.1 percent of gross domestic product, depending on what has to be provided and what the economic situation is then.

It is currently difficult to imagine that NATO's requirements will decrease in the coming years.

The opposite is more likely to be the case.

If one only assumes that the future capability targets correspond to the current needs, one arrives at remarkable sums that will have to be mobilized for the defense section in the near future.

Currently, around 50 billion euros are earmarked annually for the Bundeswehr in the medium-term financial planning.

If the special fund is used up over five years, this amount would have to increase to around 70 billion euros by 2027 for defense spending to reach around 2 percent of gross domestic product.

That promises exciting budget discussions.

Keywords: