Jump to content

© Nadine Normann

Der stilisierte Metalladler vor dem Gebäude des Bundesrechnungshofes.

2025 annual report: For greater impact

2025 annual report: For greater impact

The new borrowing options require particularly responsible management of the available budgetary resources. In order for them to have a sustainable effect, they should be used in the best possible way. In our 2025 annual report on the government's financial and commercial management, we identify cases in which the Federal Government needs to better manage its budgetary resources: effectively, efficiently and properly.

This year's report shows that the Federal Government fails to use tax revenues effectively in many areas. For example, we found that Germany’s Armed Forces had accommodated the crews of four frigates, which are currently undergoing modernization, at much too high costs. This resulted in additional costs of at least €20 million (No. 13).  

The Federal Ministry of Finance made bad investments totalling €35 million. It purchased “secure” smartphones for customs officials which, however, did not allow encrypted communication. In practice, such smartphones had thus only limited use (No. 3).

Success is a function of effective action, not just by additional budgetary resources.

Quelle: Kay Scheller, President of the Bundesrechnungshof
Kay Scheller, President of the Bundesrechnungshof.

Moreover, the report shows in which areas the Federal Government can save budget funds or optimize their use. One example is the planned expansion of seven locks on the river Moselle. Such expansion is neither necessary nor efficient. The estimated expenditure of €855 million is not justified vis-à-vis the projected transport volumes. The Federal Ministry of Transport could also reduce any risk of malfunction in other ways (No. 9).

Far greater savings potential lies in abolishing the billion-euro tax relief for craftspeople services. The tax relief neither achieves its goal of strengthening craftspeople and small and medium-sized businesses, nor does it help to reduce undeclared work. The windfall effects are considerable. It is thus an ineffective subsidy the continuation of which is no longer justifiable (No. 22).

It is also unacceptable for the Federal Government to spend money on funding initiatives without proving that they have the desired effects. This is the case, for example, with the European Climate Initiative (EUKI). An evaluation carried out in 2021 showed that the funding fails to bring any sustainable benefits (No. 5).

There is further room for improvement in language and integration courses for citizens receiving basic income. Due to an internal directive from the Federal Employment Agency, job centres do not require citizens receiving basic income with children under the age of three to participate in language and integration courses. Only a few participate voluntarily. This delays the integration of many families into society and the labour market. The Agency needs to change its guidelines. Exceptions should only be allowed in justified cases, as provided for in the Residence Act (No. 6).

Our annual report is the basis for the decision on discharging the Federal Government

At the end of each financial year, the Federal Government is held to account to both houses of Parliament. Bundestag and Bundesrat then decide whether to grant discharge to the Federal Government for the respective financial year.

Our annual report forms an important basis for the discharge procedure. We analyse the government's revenue and expenditure, its assets and its debts. And we make recommendations on how deficits can be eliminated and budget funds used more efficiently and effectively.

This infographic describes the function of the annual report in the budget cycle.

  • © Bundesrechnungshof

In addition to the findings on the financial accounts, the main volume of the 2025 annual report encompasses 21 further reporting items that highlight areas where the government's financial and commercial management can be enhanced.

The  of the parliamentary Budget Committee will discuss the annual report in the months to come. It usually combines such deliberations with a request to the Federal Government to implement our recommendations.

You can download the annual report here . Please note: the report is only available in German.

Downloads

Annual report (Short info in English, long version only available in German)

  • 2025 annual report: For greater impact PDF, 8 MB Download
Cookies