Achim Steinbach, Chief Economist at the German Ministry of Finance and adviser to Lars Klingbeil (SPD), has strongly rejected analyses from several economic research institutes that claim the special fund for infrastructure and climate neutrality (SVIK) are being almost entirely misused or diverted from their intended purpose.
In an article published in the “Frankfurter Allgemeine Zeitung”, Steinbach argued that to properly assess the funding, one must not simply compare the absolute level of investment. Instead, the focus should be on how investments would have unfolded given the existing fiscal situation without relying on the special fund.
According to Steinbach, based on a study that the ministry will soon publish, the outcome is clear: the majority of the roughly 177 billion Euro special fund, intended for investments through 2028, would not have materialized under alternative conditions. Therefore, from a fiscal policy perspective, around 95% of these funds represent genuine additions.
The economist asserted that this directly disproves theories suggesting the fund acts merely as a “transfer station” or that its money is being misused, arguing that these critiques rest on implausible baseline assumptions, such as ignoring necessary consolidation pressures or implicitly extending the fiscal framework of previous years.
This rebuttal comes amid recent studies. In mid-March, both the Munich-based Ifo Institute and the employer-backed IW in Cologne issued reports examining whether the federal government was utilizing the 500 billion Euro special fund for genuinely “additional” investments. The Ifo Institute calculated a “misuse rate” of up to 95% for additional debt in 2025, while the Institute of German Economics (IW) estimated an 86% rate of incorrect utilization.
The Ifo Institute noted that the precise figure depends on definitional boundaries, but stated that, based on their calculations, at least three-quarters of the borrowed funds were diverted from their intended purpose. The institute’s president, Clemens Fuest, labeled this a “big problem” in March, reiterating that any supplementary debt must be allocated to investments that support long-term economic growth.
