Kay Scheller, the outgoing president of Germany’s Federal Court of Auditors, has criticised the federal government for its handling of the €500 billion “Infrastructure and Climate Neutrality” special fund. According to Scheller and leading German economic institutions, 80 % to 90 % of the allocation is being used to plug budget holes rather than to finance new infrastructure. He warned a year ago that the fund was being misused and says the situation now amounts to a “shifting station”.
Scheller notes a similar pattern with the €100 billion program aimed at the Länder. The additional amount was omitted entirely, leaving the danger that the money may be diverted to existing programmes or even to consumption, contradicting the original objective of financing new investment projects.
After 14 years at the helm, Scheller will retire at the end of May. He criticises the overall federal budget policy, noting that debt is rising exponentially. Today, almost half of Germany’s budget is spent on interest payments, defence and pension obligations. Legal commitments occupy the vast majority of the budget: roughly 90 % is fixed, leaving only about 10 % as flexible expenditure. This “rigidity” of the budget makes it difficult to introduce new measures; in times of crisis the state is often forced to seek fresh loans because revenues are insufficient to meet spending needs.
Scheller also highlighted significant financial losses to the state caused by tax evasion, undeclared work and money laundering. He cites figures of roughly €100 billion a year that remain undetected in money‑laundering activities. “The state must enforce its claims decisively” Scheller said. “Suspects should also bear the burden of proof to demonstrate the source of their funds” he added, pointing out a shift towards burden‑of‑proof reversal in the legal system.