EU reconstruction fund: Government wants to use billions from EU funds for climate protection and digitization

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Finance Minister Scholz (archive picture)

Photo: Janine Schmitz / photothek.de / imago images / photothek

Around a year after the EU agreed on aid worth billions for reconstruction after the corona crisis, the plans for the use of the funds are becoming more concrete: According to the Federal Ministry of Finance, Germany expects EU grants of around 25.6 billion euros net from the reconstruction fund, a good two billion euros more than estimated in December.

The lion's share of the money should flow into climate protection and digitization. Federal Finance Minister Olaf Scholz (SPD) spoke of a “clear signal for a climate-friendly and digital future”. Opposition politicians and environmentalists accused Scholz, on the other hand, of "fine arithmetic" and a lack of "oomph", since the majority of the money was already priced into the national Corona stimulus package.

In the morning, the Federal Cabinet passed the "German Development and Resilience Plan", which is a prerequisite for the allocation of funds from the EU fund totaling 750 billion euros. With the billions from Brussels, among other things, the development of the hydrogen economy, energy-efficient building renovation and the digitization of the railways are to be funded. In addition, the federal government wants to promote 400,000 electric charging points in residential buildings and create incentives for the purchase of alternatively powered buses for local public transport.

Scholz presented the planned editions in a joint video press conference with the French Finance and Economics Minister Bruno Le Maire. Le Maire called on the EU Commission to examine the national plans as soon as possible: "The money should flow as quickly as possible, in September at the latest, (...) but better in July," he emphasized. Otherwise the EU would fall behind the USA and China in terms of economic reconstruction.

As already announced, France wants to use the funds to cross-finance its national Corona aid package.

It provides for extended short-time work benefits and incentives for hiring young people as well as the expansion of freight transport by rail and building insulation.

The EU aid fund goes back to an initiative by Chancellor Angela Merkel (CDU) and French President Emmanuel Macron.

Environmentalists criticize "tired reform plan"

The Berlin plans met with sharp criticism from environmentalists and opposition politicians: "Tired reform plan instead of oomph from the crisis," said the environmental protection organization WWF.

The federal government is refinancing "only a large part of the corona measures of the past year".

When presenting the Corona economic stimulus program last June, Scholz said that the country should "come out of the crisis with oomph".

The Greens also accused the government of "calculating rather than providing additional growth impetus for real climate protection."

"It would have been more effective to put the money into European energy, data and rail networks," emphasized Franziska Brantner, spokeswoman for European policy for the parliamentary group.

Subsidy projects that had been planned for a long time were shamelessly relabelled as reform projects.

Moritz Körner, FDP member of the European Parliament

The FDP MEP Moritz Körner accused the government of "decadent unwillingness to reform".

"Subsidy projects that had been planned for a long time were shamelessly relabelled as reform projects," emphasized Körner.

The CSU MEP Markus Ferber was also critical: "It is not surprising that France is lacking reform enthusiasm," he emphasized.

"I would have expected more from Germany."

Before the EU Commission can raise the money it needs for the fund on the capital markets, all EU countries must ratify the financing decision.

So far, 19 of the 27 states have done so.

The largest single beneficiary of the reconstruction aid is Italy with a good 191 billion euros.

The parliament in Rome approved the national development plan on Wednesday, which provides for motorway repairs and the expansion of high-speed internet, among other things.

mic / afp