Federal Audit Office: Energy defense shield possibly unconstitutional

Olaf Scholz

The Chancellor had promised a “double boom” to combat the consequences of the energy crisis.

(Photo: AP)

Berlin The Federal Court of Auditors doubts the constitutionality of the federal government’s planned energy defense shield. “The planned borrowing in reserve violates the constitutional principle of annuality,” write the auditors in a report to the budget committee on October 18, which is available to the Handelsblatt. In other words: the protective shield is not compatible with budgetary law.

The opinion of the Federal Court of Auditors contains some explosiveness. The law to set up the energy defense shield is to be passed by the Bundestag this Friday. However, there are some legal doubts about stock borrowing.

A constitutional lawsuit by the Union against another special fund in the federal budget – the climate and transformation fund – is currently pending, for which the traffic light coalition at the beginning of the year chose the same method of borrowing as is now used for the energy defense umbrella.

The report of the Federal Court of Auditors now gives the critics further arguments. Annuality is a “fundamental constitutional budgetary principle”, write the auditors in their analysis. This rule, laid down in the Basic Law, states that the budget is drawn up for one year. Loans taken out are intended to offset a budget deficit in the same year.

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However, the federal government is violating the principle of annuality if it takes out loans under the energy rescue package in 2022 for expenses that are only due in 2023 and 2024.

For example, the federal government is planning to invest a special fund of 200 billion euros this year, which will then be used until 2024 to cover expenses such as a gas price brake, company aid and other measures.

Defense shield equal to “several problems”

From the point of view of the Federal Court of Auditors, the financing of the new rescue package is also questionable. This year, the federal government once again identified an emergency situation within the debt brake. Thanks to this exceptional rule, the coalition can take on another 200 billion euros in debt in 2022, which is then to be used to fill the new rescue package.

However, this is problematic in “several respects”, writes the Court of Auditors. The new defense shield “further reinforces the already existing lack of transparency in the federal budget,” write the auditors. There are already a number of other sub-budgets in the federal budget, such as the energy and climate fund or the special fund for upgrading the Bundeswehr.

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In addition, the planned emergency decision in the context of the debt brake is doubtful, the auditors complain. An emergency is characterized by the fact that it occurs unforeseen and can change just as unforeseeably.

Therefore, there must be a clear temporal connection for the determination of such a situation. “Because no one can seriously foresee how the emergency situation will develop, emergency loans must not be legitimized well in advance,” writes the Federal Audit Office.

Rather, the Bundestag must regularly assess the situation. It is incompatible with this to approve emergency loans “in advance”. In its report, the Court of Auditors advocates financing the protective shield directly from the normal federal budget.

More: Ego trip or smart course? Scholz defends “double boom” against criticism from EU partners

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