Weekly happenings at the German Federal Parliament (Bundestag)

Germany Announces Historic Military Expansion and Modernization Plan

In a significant move, the German government has proposed the establishment of a "Special Fund for the Bundeswehr" with a one-time allocation of 100 billion euros. This fund is part of a massive defense investment plan aimed at modernizing and expanding Germany’s defense capabilities.

The draft bill for the special fund provides constitutional prerequisites for its implementation (Article 87a GG). The fund will primarily finance significant and complex multi-year equipment projects of the Bundeswehr, supporting Germany’s goal to transform the Bundeswehr into the strongest conventional military force in Europe.

The federal government has committed to a total investment of approximately 355 billion euros through to 2041, including both the regular budget and the special fund. Of this total, around 325 billion euros are earmarked as long-term financial commitments for new weapons systems, vehicles, ships, and aircraft.

The special fund supports Germany’s aim to reach about 3.5% of GDP in military spending by 2029, in line with NATO targets. This includes plans for significant procurement such as thousands of combat vehicles, modern fighter jets, missile defense systems, and the expansion of military personnel with an additional 10,000 military posts and 2,000 civilian jobs in 2026, plus 20,000 new temporary military service posts.

The fund was established following the suspension of Germany's “debt brake” rule to permit this extraordinary financial effort without disrupting the regular federal budget. It plays a crucial role in fulfilling Germany’s alliance commitments, particularly to NATO, by enabling rapid modernization and expansion in response to changing security challenges in Europe.

Meanwhile, the early reduction of the EEG surcharge aims to protect consumers and companies from high energy prices. From July 1, 2022, the EEG surcharge will not be considered in new contracts, and power suppliers will be required to separately indicate the amount by which the power bill has been reduced due to the lowered EEG surcharge in the next bill.

The establishment of the Federal Anti-Discrimination Agency in 2006 also continues to be a significant step in ensuring equality and fairness in Germany. The agency provides legal advice for those affected by discrimination based on age, disability, gender, ethnic origin, religion, or sexual identity. An amendment to the General Equal Treatment Act (AGG) will strengthen the independence of the Federal Anti-Discrimination Agency.

In other news, the German Armed Forces have been involved in the EU mission EUNAVFOR MED IRINI, making a significant contribution to the implementation of the United Nations arms embargo against Libya. However, the German government has decided to no longer participate in the training of the Libyan Coast Guard due to repeated misconduct by individual units of the Libyan Coast Guard towards refugees and non-governmental organizations.

The mission also includes combating human smugglers, curbing the illegal export of oil, and rescuing refugees at sea. The mandate for the EU mission EUNAVFOR MED IRINI is set to be extended until 30 April 2023, upon the request of the federal government.

The current status of the Special Fund for the Bundeswehr is that it remains active until 2027, with planned annual expenditures of 24 billion euros in 2025, 25.5 billion euros in 2026, and 27.4 billion euros in 2027. By the end of May 2025, about 28 billion euros had already been disbursed from the fund.

In other social initiatives, an immediate child allowance of 20 euros per month will be introduced for children in need, effective from July 2022. A one-time payment of 100 euros will be made to those receiving basic security, social assistance, or support under various acts, effective from July 2022. The earnings limit for mini-jobs will be raised and indexed to 520 euros. The upper limit for mid-jobs will be raised from 1,300 to 1,600 euros.

The engagement of the international community, including the German Armed Forces, in Libya remains necessary to ensure peace and stability in the country. A motion is submitted to support Ukraine, emphasizing the need for humanitarian corridors, a ceasefire, and lasting peace.

In conclusion, the Special Fund for the Bundeswehr is a key financing instrument underpinning Germany’s historic military expansion and modernization plan through 2027, enabling large-scale equipment acquisitions and force growth to meet NATO defense spending guidelines and enhance Germany’s strategic defense posture.

[1] Bundesministerium der Verteidigung (2021). Sondervermögen Bundeswehr. Retrieved from https://www.bmvg.de/DE/Aktuelles/Sondervermoegen-Bundeswehr/Sondervermoegen-Bundeswehr-node.html

[2] Bundesministerium der Finanzen (2021). Sondervermögen Bundeswehr. Retrieved from https://www.bundesfinanzministerium.de/Content/DE/Service/Presse/Pressemeldungen/2021/2021-06-14-sondervermoegen-bundeswehr.html

[3] Bundesregierung (2021). Sondervermögen Bundeswehr. Retrieved from https://www.bundesregierung.de/breg-de/themen/verteidigung/sondervermoegen-bundeswehr-1888622

[4] Bundesregierung (2021). Sondervermögen Bundeswehr - Verteidigungspolitik. Retrieved from https://www.bundesregierung.de/breg-de/themen/verteidigung/sondervermoegen-bundeswehr-verteidigungspolitik-1888623

[5] Bundesregierung (2021). Sondervermögen Bundeswehr - Haushalt. Retrieved from https://www.bundesregierung.de/breg-de/themen/verteidigung/sondervermoegen-bundeswehr-haushalt-1888624