PARIS --- The speech delivered by German Chancellor Olaf Scholz on February 27 is widely seen as a complete U-turn in the course of the German defence policy. If there is a U-turn, it is mainly in regard to the coalition contract, which, barely signed, was largely modified. All things considered, the massive spending plan is more a vigorous catch-up than a deep revolution in German defence affairs.
First, no revolution can be noted in defence policy, as the weapons delivery (5,000 helmets, 1,000 Panzerfaust 3, 500 Stinger, 50 Milan launchers and 400 missiles, and 9 D-30 Howitzers) to a country at war (Ukraine) will remain an exception. It is worth noting that during the electoral campaign, Mr. Habeck, then co-chairman of the Greens, has provoked a political dispute, not only among his party but also on the entire political stage in Germany, by saying that arming Ukraine would be necessary…Ukraine will remain an exception, as the Kurds were for the previous Government.
Nor will foreign missions change: if the German army will remain engaged in NATO & EU & UN peacekeeping missions (on air, land and sea) and if new regulations on the use of armed drones abroad are bound to be written soon, there will be no combat missions for the Bundeswehr. Finally, the NATO nuclear-sharing mission will be pursued by new means, but neither given up nor modified.
Secondly, the Bundeswehr remains a Parliamentary army, which means that all the pieces of the big spending plan of Mr. Scholz, will go through the classic procedures of the Bundestag’s Committees (Defence and Budget) and to the Bundesrat, which is new.
Mr. Scholz’s big plan will modify the authorized debt level: therefore, he needs to modify the Basic Law. Amendments to the Grundgesetz must be adopted by the Bundestag and the Bundesrat, each time with a two-thirds majority (Article 87a of the Grundgesetz).
However, the Union (CDU and CSU), without which a two-thirds majority cannot be achieved (197 deputies and 23 elected to the Bundesrat), refuses to vote for a blank check and demands two guarantees: the fund should go exclusively to Defence (and not to “security”, a vaguer concept) and the programs to be funded, and the projects to be launched, should be clearly mentioned and documented (added value for the Army, the tax-payer and the German defence industry).
The Union also insists on the permanent increase of the budget to 2% of GDP; but EP14 (the defence planning in the German nomenclature) only provides, as is the rule, financial planning until 2026.
Thirdly, along with the special fund of €100Bn which will take time to be implemented and spent, the second source of finance, the yearly defence budget, will remain flat.
The 2022 federal budget will amount to at least at €458 billion:
Year / Government expenditures (New debts) (in billion €)
-- 2021: 557.1 (215.6)
-- 2022: 457.6 (99.7)
-- 2023: 412.7 (7.5)
-- 2024: 415.7 (10.6)
-- 2025: 416.9 (11.8)
-- 2026: 423.1 (13.7)
Source: Eckwertebeschluss der Bundesregierung zum Regierungsentwurf des Bundeshaushalts 2023 und zum Finanzplan 2022 bis 2026, page 3.
The Special Fund (Sondervermögen) of €100 billion is planned within this envelope; this amount will be covered by new & extra debts, thus making it mandatory to modify the Basic Law, as mentioned above.
With regard to the annual Defence budget, the expenditure planned for the Defence budget in the second draft of the Government will increase by approximately €3.5 billion to reach €50.337 Billion in 2022, of which €20.4 billion for Defence acquisitions; from 2023, the budget stabilizes at €50.100 Billion until 2026.
Between the requests of the MoD before Mr. Scholz’s speech, and his statements on February 27, the increase is massive; the MoD needed an extra € 37.6 billion to fund current programs and planned projects, while the Sondervermögen not only integrates that request but also adds an additional €62.4 billion.
This increase, however, is not integrated in the annual budget, but relies on the special fund, whose implementation will take time, given the need to modify the Basic Law and the procedures needed to award contracts and time to fulfil them (in all: a decade?).
Fourthly, as the most important expenditures will be invested in replacement programs and not new ones, new capabilities will be quite rare at the end of the day. If the definitive list of programs to be funded by the Sondervermögen is not yet known in detail, it is generally assumed by our sources that the list should include the ones in the top graph.
Only three new programs should be financed: the Twister (Timely Warning and Interception with Space-based TheatER surveillance) project, the combat cloud and the digitalization of land operations. All the rest was previously planned (FCAS, MGCS, Puma vehicles, upgrade of Leopard, submarines & corvettes, heavy helicopters) or should have been replaced long before (Tornados).
In provisional conclusion, the massive increase decided by Mr. Scholz (quite alone), will be more a catch-up of three long decades of financial disarmament than a robust military build-up which would have changed the face of the Bundeswehr by adding new capabilities and new doctrines.
Mr Scholz will give more muscles to the Bundeswehr, but not new brains.