With a special fund of 100 billion euros, Olaf Scholz wanted to push the “change in the era” in security policy. But lack of money is not the only problem. What about the urgently needed reform?
It was less than three days ago that Vladimir Putin sent his troops to take the Ukrainian capital of Kyiv when the Chancellor stepped up to the lectern in the German Bundestag. On February 27, Olaf Scholz summed up the most expensive and extensive plans to date for upgrading the Bundeswehr with a term that will later be named “Word of the Year” in the fall: turning point in time.
“We are experiencing a turning point,” says Scholz. “That means the world after is no longer the same as the world before.” In fact, for many in those days, the time seemed to have changed overnight. For the first time since the Second World War, an extermination campaign is being waged against a sovereign European state. The turning point refers to the outrageous that is happening in and with Europe and requires action.
But the chancellor’s turning point could do even more: it’s not just a cause, it’s also a good goal. It will be necessary to turn the tide yourself – in German foreign and defense policy, which has failed and calls for a reorientation. The naïve assumption that an imperialist like Vladimir Putin can be gotten over with good words and economic relations has failed. The tanks rolling on Kyiv make the “change through trade” strategy coined by Angela Merkel in relation to Russia ridiculous.
So now the order of the day is: stop the sluggish tanker, reverse thrust and head in a different direction with full force. After the Scholz speech, the stately sum of 100 billion euros is in the room for the “full power” factor. As a “special fund” it is intended to finance the qualification of the Bundeswehr. A smart move, because a simple increase in the federal budget would not be possible due to the debt brake. The special fund means that this money, although obtained through new debts, may only be invested for the turn of the century. For the Treasury, that makes the critical difference that allows them to approve this new debt.
But the size of the billions decreases significantly when you compare them with the 64 billion euros that add up as a deficit from the austerity policy in the defense budget over the past three decades. This is the analysis of the German Society for Foreign Policy. Long-standing underfunding, which has only been partially corrected in recent years, has left large gaps in the Bundeswehr’s equipment.
Two other factors also reduce the special fund: On the one hand, inflation in the armaments industry has a greater impact than in other sectors. On the other hand, the special fund should be issued in five years. This is how the market works: Anyone who has to invest money under time pressure will not get the best prices from the providers. Especially when, in view of the fragile global political situation, other governments also come up with the idea of ??better equipping their armies – and, in case of doubt, have long since ordered new weapons and ammunition because of leaner bureaucracy by the time Germany starts discussing it.
According to Scholz, the goal of all efforts is “an efficient, ultra-modern, progressive Bundeswehr that protects us reliably”. A sentence that seems to consist of nothing but self-evident things that are not self-evident given the state of the German army. The shopping list of the Federal Ministry of Defense (BMVg), which became public in June, was correspondingly long.
The “air dimension” forms the largest item on the list called “business plan”. It includes, among other things, the US fighter jet F-35, which is to replace the outdated Tornado. Then the ministry wants to procure more CH-47 heavy transport helicopters, further develop the Eurofighter for electronic warfare, order light support helicopters for the army and arm the existing Heron TP drone.
With estimated costs of 40 billion euros, the projects for this dimension accounted for the largest volume. But the lists for the dimensions of sea and land, as well as a separate item for digitization and management skills, were also long and costly. Too long and too expensive, as the Federal Court of Auditors determined after examining the business plan in autumn.
In his statement, he criticizes, among other things, “that the BMVg has not yet taken into account expenditure for debt service from 2024 in its planning. A ‘buffer’ for rising interest rates and for rising procurement and development expenditure due to inflation is also not recognizable”. The audit authority urges more caution in planning.
The fact that the ministry initially did not even price in inflation, which will naturally reduce the purchasing power of the 100 billion over the next few years, does not suggest that Christine Lambrecht is preparing her department for the major challenges that a real turning point in has hired. In the ZDF interview, military historian Sönke Neitzel misses the willingness to “think big and implement it” in order to “tackle the big problems”. Germany is in the process of “running the turning point against the wall at full speed”.
Michael Brzoska from the Institute for Peace Research and Security Policy at the University of Hamburg has investigated where the major problems in equipping the Bundeswehr lie. “It’s not the money, stupid” – “It’s not about the money, stupid,” is the name of the study, which among other things complains about risk aversion in the procurement bureaucracy. According to the study, the administrative processes are so fragmented and complex that procedures take far too long.
Brzoska’s criticism is expressed in a similar way in the procurement apparatus itself. In order to protect yourself against lawsuits from suppliers who were not considered in an award, files must be created by the case. Even when ordering a new model of long underwear, the regulations require such a comprehensive check for sustainable production, skin and environmental compatibility, compliance with all EU directives and many other parameters that in the past it could take nine months for the order for the delivery of new long underwear was advertised at all.
How many test processes it takes to award a billion-dollar contract for fighter jets is probably beyond the possibilities of your own imagination. The criticism of German security experts is aimed at the fact that nothing has changed in this nested administrative apparatus overloaded with regulations. However, it is necessary to streamline the system, streamline hierarchies, minimize redundancies and pool competencies.
But the BMVg, as a house involved in such processes, works completely differently. There is a whole hierarchy level there, it is said, which does not exist in any other ministry. To put it simply, there is an additional floor with desks on which papers that were previously on other desks for examination end up, which extends the entire examination process even further.
That defense spending needs to be audited and controlled – no doubt about it. However, if this is done on a scale that pushes the apparatus to the brink of its ability to act, there is no point in turning a few screws. The whole system needs to be realigned. Sönke Neitzel sees no willingness for such a reform, neither on the part of the minister nor in the Chancellery.
In his analysis, Michael Brzoska also misses the clear objective of procurement. For years, the EU and NATO have agreed that it makes sense for partner countries to rely on the same types of weapons, if possible even to order them together. A higher quantity lowers the production costs of the company and simplifies further development. It is enormously advantageous for the cooperation of the armies if soldiers of different nations are familiar with the same weapons.
That’s the theory. In practice, the European NATO countries alone use 16 different types of armored personnel carriers. If you do manage to agree on a joint award of the contract, many of the governments involved – the Germans in any case – develop special national requests that are also brought in.
Too often procurers, but also the Bundeswehr itself, strive for the so-called “gold rim” solution with lots of extra tricks for every conceivable combat situation. As an example, Brzoska cites the procurement of two tankers, for which the navy insisted on a special design, “although according to the assessment of the Federal Audit Office, price auditors from the procurement office and external experts, a significantly cheaper solution” would have been possible. The breakdown tank “Puma” demonstrated in mid-December what is still threatening, apart from a significant increase in costs, if devices are technically overloaded: total failure.
Another factor that leads to high additional costs is the preference given to one’s own armaments industry over foreign companies who would offer better prices. In principle, the suggestion to commission the German armaments industry is understandable. But given the glaring capability gaps that have existed in the Bundeswehr for years, the price-performance ratio must come first. Location policy cannot be afforded in the current disaster.
And even if there is absolutely no reason not to order from the domestic manufacturer, for example when it comes to replenishing the shockingly low ammunition stocks, Germany does not face the situation. The recently held munitions summit in the Chancellery brought about an exchange between politics and the armaments industry, but no concrete orders.
A ray of hope is the approval of the budget committee in the Bundestag to buy 35 stealth jets from the US manufacturer Lockheed-Martin. The F-35s are already flying in several European armies and offer sophisticated stealth technology that makes it difficult for enemy radar to locate the aircraft. However, things will get really exciting now when it becomes clear how much time will pass between the decision and the order.
