Overview

• The Bundestag approved allocating €100 billion from the 500‑billion special fund to the Länder via the Königsteiner Schlüssel without a mandated municipal minimum share.
• Coalition leaders redirected about €3 billion within the fund to autobahn and road projects, partly by trimming planned chip subsidies, with a two‑year check planned on whether road funds suffice.
• The Transport Ministry has identified a €2.3 billion rail funding gap through 2029, and far larger shortfalls are cited for the 2030s, with no new fix announced.
• Fiscal watchdogs and economists warn of weak safeguards and non‑additional spending, while a parallel change allows Länder structural borrowing up to 0.35% of GDP to co‑finance investments.
• States are moving ahead with plans, with Schleswig‑Holstein outlining a €3.4 billion package including €2.1 billion for municipalities starting in 2026, and EU governments have cleared Germany’s broader borrowing plans.