Overview

• The Bundesrechnungshof’s 8 September report labels the draft law for the €100 billion Länder share of the €500 billion fund “substanzlos,” citing dropped additionality rules, no binding economy checks, no success controls and no federal clawback rights.
• The auditors warn that without minimum requirements the debt-financed money could replace regular budgets, enable double funding and fail to raise investment levels as intended.
• The revised bill no longer includes an earlier idea to channel at least 60 percent of Länder funds to municipalities, a change the watchdog also criticizes.
• Detailed program shifts into the fund are already planned, including KfW housing schemes, LNG terminal costs and hospital restructuring; a €4 billion hospital inflation compensation is flagged for constitutional review as it covers running costs rather than investment.
• Even as parliamentary scrutiny continues, Brandenburg set out roughly €3 billion in priorities for transport, education, security and hospitals and aims to start projects once federal requirements are in place.