The German government has announced plans to conduct regular success controls for the newly established special fund, Infrastructure and Climate Neutrality, amidst warnings of misallocation of funds. According to the draft bill from the Federal Ministry of Finance, the government will assess the effectiveness of infrastructure projects as early as the planning phase to ensure they improve infrastructure and foster economic growth.
The draft bill outlines the objectives and methods for monitoring the success of individual measures, with the first control scheduled four years after the law’s entry into force and the second eight years later, as well as at the end of the special fund’s term.
Despite the expected significant increase in the national debt, the Ministry of Finance is not concerned, as the infrastructure investments are expected to have a lasting impact on the German economy, potentially offsetting the negative effects of higher debt through increased tax revenues and reduced transfer payments, such as the citizen’s basic income.
The draft bill also addresses concerns that the special fund could primarily fuel inflation, given the current capacity constraints. While the ministry acknowledges that there may be effects on individual prices and the overall price level, it believes these will be limited due to the long-term nature of the funding period.