by Michael Hollister
Published at apolut media on May 05, 2026

3.737 words * 20 minutes readingtime

How Germany Spends 111 Billion Euros Without Being Able to Say What For

The Apparatus in Self-Contradiction

On April 27, 2026, there was a brief moment of silence at the Federal Press Conference in Berlin. A journalist from the Ostdeutsche Allgemeine Zeitung had put a straightforward question to the spokeswoman of the Federal Ministry of Defense: how many of the defense procurement items contracted since February 2022 had actually been delivered and declared operationally ready as of April 1, 2026? A list, replied Natalie Jenning, was not something she could provide. She referred the journalist to the ministry’s website.

It was not the first time that answer had been given. A few days earlier, the ministry had provided the same response in writing – in its reply to a formal parliamentary inquiry submitted by Left Party MP Dietmar Bartsch. An “automated, centralized evaluation of all procurement projects in the sense of the question” was not possible. Several thousand pages would need to be reviewed manually. The staffing requirement was “not foreseeable” and could “lead to delays in defense-relevant projects.”

The subject of this inquiry is 47,000 procurement contracts with a combined value of 111 billion euros – contracts concluded since February 27, 2022, the day Olaf Scholz announced the Zeitenwende. Approximately 30 contract closings per day, for four years. When the press conference was pressed on how it was possible that the ministry had no overview of a three-digit billion-euro sum, the spokeswoman distanced herself from that characterization. The ministry naturally knew whether contracts were being fulfilled and what was “arriving on the lot.”

Both statements cannot simultaneously be true.

What Cannot Be Answered

The Bartsch inquiry is held by the German Press Agency and has been documented across multiple daily newspapers. It targets the core of any serious procurement policy: how many of the projects agreed since 2022 have been completed and placed into Bundeswehr service by March 1, 2026? The ministry’s response amounts to an admission that it does not know – or at least does not know in a form accessible without unreasonable effort.

Bartsch described the situation as an “alarm signal.” Controlling mechanisms and a comprehensive overview were missing. This raised the risk that billions of taxpayer funds and borrowed money were “seeping away into delayed or inadequate projects.” Any mid-sized company awarding contracts in the six-figure range maintains a supplier, contract, and controlling system as standard infrastructure. An organization closing 30 contracts per day without a centralized evaluation system has either lost control of its administration – or is refusing to provide the information.

There is also a linguistic imprecision that is substantively central. When a defense item “arrives on the lot,” that does not mean it is available to troops, staffed, and integrated into the logistics chain. Delivery is not operational readiness. It is precisely this gap – between contractual fulfillment by the manufacturer, physical delivery to the federal government, and actual usability within the Bundeswehr – that determines whether 111 billion euros has produced genuine defense capability or not. That gap remains unanswered.

For the current year 2026, the government has made available 82.7 billion euros in the regular defense budget plus a further 25.5 billion euros from the special fund – together more than 108 billion euros in this fiscal year alone. To the question of where the cumulative prior-year funds went, there is no consolidated answer.

The Findings of the Government’s Own Financial Auditors

The situation would be less explosive if it were a surprise. It is not. The federal government’s supreme audit institution has been documenting exactly this risk in writing since 2022.

On May 27, 2025, the Federal Court of Audit submitted a special report under Section 99 of the Federal Budget Code – the most stringent form in which the institution reports directly to the Bundestag. Title: “Need for Action at the Bundeswehr – Realignment Toward National and Alliance Defense Requires Responsible Use of Funds and Course Correction in Organization and Personnel.” The finding is unambiguous.

“A security- and defense-policy-driven ‘Whatever it takes!’ must not become ‘Money is no object!’,” declared Court of Audit President Kay Scheller upon presenting the report. It is this formulation that circulated through the coverage in the following weeks – and that gains additional weight in retrospect when set against the ministry’s April 2026 response.

The report states: “Audit findings of the Federal Court of Audit show that the Federal Ministry of Defense and the Bundeswehr are in part unable to deploy financial resources in a targeted and economical manner.” The examples range, according to the report, “from failed procurement and digitalization projects to management errors and avoidable additional expenditures in the millions on unused software licenses.” The personnel structure had become “significantly more top-heavy” compared to 2010. Soldiers were being tied up in administrative tasks inside and outside the armed forces – and were therefore unavailable for military duties.

Particularly noteworthy is the warning the Court of Audit derives from its administrative experience: “When an organization is given significantly more financial resources in a short period of time, the risk of uneconomical conduct increases – also because the Federal Ministry of Defense has stipulated that the factor of time now has the highest priority for procurement.” And further: “If financial resources are not deployed in a targeted manner, they are lacking elsewhere – specifically for the core mission.”

The Court of Audit’s assessment is therefore not a political controversy but a technical diagnosis. It does not come from the opposition, from pacifist circles, or from media critics. It comes from the institution the Bundestag itself established to oversee the use of public funds. And it was publicly available nearly a year before the ministry told the public it could not centrally account for where the funds had gone.

Four Years of Warnings, Four Years of Inaction

The 2025 special report was not an isolated event but the endpoint of a chain of documented warnings – beginning on April 14, 2022, six weeks after the Zeitenwende speech.

In a report to the Bundestag’s budget committee, the Federal Court of Audit stated that financing the Bundeswehr was a core state obligation and belonged “in the core budget, not in a special fund.” The argument was technically clear: the debt servicing and interest costs arising from the special fund would not appear in the regular federal budget. The construction shifted burdens into the future, removed them from ongoing parliamentary scrutiny, and undermined the principle of budgetary transparency.

The report was acknowledged by the federal government. The Bundeswehr special fund was established a few weeks later through a constitutional amendment (Article 87a, paragraph 1a), with borrowing authorization of up to 100 billion euros. In May 2022, the Court of Audit repeated its position: Bundeswehr financing was a core obligation and belonged in the core budget. In October 2022, it dismantled the special fund’s economic plan. Collective budget lines with authorization commitments spanning multiple projects, the Court noted, allowed the ministry to shift funds between projects – jeopardizing the complete financing of any individual project. With more than 150 projects bundled together, it was moreover questionable whether they all qualified as “significant” projects for which the legislature had intended the special fund.

Der Spiegel at the time described “rushed planning” that the Court of Audit had “torn apart.” Little was changed.

The Court of Audit’s finding on collective budget lines is identical to its finding of April 2026. When funds run through collective lines rather than being broken down into individual line items, exactly the system emerges that the ministry now defends by arguing a centralized evaluation is not possible. The opacity the supreme auditing authority warned about in 2022 is not, in 2026, an oversight – it is the result of an architecture. It was built with full awareness of the consequences.

The Discrepancy: Money Flowed, Combat Capability Did Not Follow

The operational consequences of this architectural problem are documented in detail in separate analyses (see “Siegfähig” and “Kriegstüchtig auf dem Papier, Siegfähig in der Planung”). Here, only the central discrepancy that translates the Court of Audit’s findings into numbers.

Between 2015 and 2024, Germany increased its defense expenditure from approximately 38 to more than 88 billion US dollars per year, according to SIPRI data – a rise of more than 130 percent. In 2025, German military expenditure rose a further 24 percent to 114 billion US dollars. Germany now ranks fourth globally in defense spending, behind the United States, China, and Russia. Setting aside those three major powers – against whose volumes no single European country can compete in any case – Germany is the world’s largest defense spender, ahead of India, Saudi Arabia, the United Kingdom, France, and Japan.

That same Bundeswehr holds enough ammunition for two to five days of high-intensity combat operations, depending on the service branch. The operational availability rate of the Eurofighter fleet runs between 30 and 60 percent. Among the Type 212A submarines, only two of six boats were operationally ready for extended periods over several years. In logistics, 87 percent of the fuel tanker vehicles required to supply the planned brigade structures are missing. For 155mm artillery ammunition, the shortfall relative to NATO requirements for 2031 stands at approximately 91 percent – and portions of the shells procured to date have been delivered without fuzes or propellant charges.

The question that arises from setting these two data series side by side is the question the Federal Court of Audit put – in the language its mandate permits – four years ago, and that the Federal Ministry of Defense did not answer in April 2026: where did the money go?

The possibilities are limited. First: funds have flowed into procurement projects not yet delivered. That would be the charitable reading and would account for a significant portion of the 111 billion euros – but in that case, a status-of-delivery list by project would be a routine controlling output, not an “unforeseeable” burden. Second: funds have flowed into projects that were delivered but are not operationally ready – because ammunition arrives without fuzes, radios do not fit the vehicles, or software does not function. That is precisely what the Court of Audit describes. Third: funds have flowed into administration, external consulting, personnel structures, oversized staff divisions, and bureaucracy, without reaching procurement or operational readiness. That too the Court of Audit describes when it speaks of a “top-heavy personnel structure.” Fourth: funds were committed in projects whose output was outsourced – the consulting scandal surrounding the ministry around 2018, in which external firms were engaged for nine-figure sums without producing verifiable operational results, remains to this day the most prominent case of a structure in which money reached the apparatus but not the troops.

Which of these possibilities applies, and to what extent, the ministry could answer. It should answer. It does not.

Doubling Down Instead of Taking Stock

Against this backdrop, the federal cabinet on April 29, 2026 approved the budget framework for the 2027 federal budget and financial planning through 2030. Federal Finance Minister Lars Klingbeil described it as a step that would make Germany “stronger and more resilient to crises.”

The figures attached to this decision are without precedent. The defense budget rises in 2027 to 105.8 billion euros – equivalent to 20 percent of the entire federal core budget. By 2030, it is projected to grow to approximately 180 billion euros. Net new borrowing, originally projected at 88 billion euros for 2027, rises under the framework decision to 111 billion euros. Added to this are borrowings for the Bundeswehr special fund and the infrastructure and climate neutrality special fund (SVIK) of approximately 86 billion euros combined. By 2030, annual total new federal borrowing is set to exceed 200 billion euros.

This construction was not legally possible without a prior constitutional amendment. In March 2025, the Bundestag approved by a two-thirds majority a reform of the debt brake anchored in Articles 109 and 115 of the Basic Law. The core provision: federal defense expenditures exceeding one percent of nominal gross domestic product no longer count as credit-financed expenditure under the fiscal rule. Civil defense, intelligence services, cybersecurity, and support for countries under armed attack are similarly excluded from the calculation.

The fiscal architecture has thus fundamentally shifted between 2022 and 2025. The 2022 Bundeswehr special fund was an exception within an otherwise operative fiscal rule – with a fixed ceiling of 100 billion euros, a repayment obligation, and earmarking requirements. The 2025 sectoral exemption is no longer an exception in that sense but a structural removal of an entire expenditure category from the discipline framework of the Basic Law. Unlike the infrastructure and climate fund – capped at 500 billion euros – it is open-ended.

It is precisely this asymmetry that the Federal Court of Audit explicitly criticizes in its April 20, 2026 opinion. The unlimited sectoral exemption encourages, per the Court’s finding, a careless approach to “seemingly unlimited available funds.” There is the additional risk that expenditures with no direct connection to defense in the strict sense will be shifted into the defense fund – particularly since the definition of exempted expenditures in the reform was “deliberately” drawn broadly. Cybersecurity, civil protection, and intelligence services are categories whose boundaries with regular domestic and administrative policy are fluid. Whatever is declared a defense expenditure will henceforth escape the debt rule.

This also explains why the Court of Audit’s warnings between 2022 and 2026 have grown sharper. In 2022, the concern was a one-time special construction alongside the existing order. In 2026, the concern is the existing order itself. The debt brake was not abolished in spring 2025 – but for its fiscally most significant category, defense, it was suspended. The system the supreme auditing authority criticized in 2022 as an exception has been, since 2025, the rule.

Nine days before the cabinet decision, on April 20, 2026, the Federal Commissioner for Economic Efficiency in Public Administration submitted a 27-page opinion on exactly this decision. It is a warning in the language of financial oversight.

Federal expenditure, including special funds, rose between 2019 and 2026 from 362 to 633 billion euros – an increase of 75 percent. Current revenues excluding net new borrowing rose over the same period by only approximately 20 percent. The federal government can in 2026 finance only around 70 percent of expenditures planned across the core budget, the Bundeswehr special fund, and the SVIK from current revenues. In the 2026 federal budget plus the two special funds, “nearly every third euro is credit-financed,” the Court of Audit states. For the period 2025 to 2029, more than 800 billion euros in new debt is planned under current projections. The federal debt stock will thereby rise to 2.7 trillion euros by 2029 – in 2018, it stood at 1.3 trillion euros.

That carries a price. Federal interest expenditures double according to the Court of Audit’s calculations between 2025 and 2029 to approximately 66.5 billion euros per year. The interest ratio in the federal budget reaches nearly 12 percent by 2029. Three expenditure blocks already consume nearly half the entire federal budget in 2026: pension insurance payments (127.4 billion euros), defense (93.5 billion euros), and interest payments (30.3 billion euros) – together approximately 251 billion euros out of a total volume of 524.5 billion euros.

Kay Scheller’s opinion ends with a warning: without a change of course, Germany’s creditworthiness and the stability of the European economic area face long-term jeopardy. Special funds, the Court of Audit writes, “tempt policymakers to defer uncomfortable measures.” As early as March 2026, the institution had warned of misuse of the special fund as a “switching yard” that achieves nothing but cosmetic budget management.

It is the last major opinion Scheller will author in this capacity. The Court of Audit president is retiring on age grounds – after twelve years in office, during which Lars Klingbeil had most recently even sought to cut the institution’s budget, apparently having grown weary of its debt criticism.

Cui Bono: The Question of Structures

The question of who benefits from a system without controlling is not a conspiracy theory. It is the question the Court of Audit itself poses when it points to “failed procurement and digitalization projects,” “management errors,” and “avoidable additional expenditures.” Those who do not know what was purchased cannot audit what was not needed. Those without a centralized evaluation also lack an evaluation of contractors, contract terms, cost overruns, cancellations, and interim invoices.

Who structurally benefits from such an architecture can be derived from the logic of procurement itself. First, the defense manufacturers, who align their production capacities to large orders and generate follow-on contracts through delays, retrofits, and modifications. Second, the consulting industry, which has been active in defense ministries for years at nine-figure annual sums – the 2018 consulting scandal was a symbol, not an anomaly. Third, the administrative apparatus itself, whose personnel structure has according to the Court of Audit grown significantly more top-heavy compared to 2010: more staff divisions, more positions, more hierarchical layers, fewer frontline troops.

What is structurally present here is not a single scandal. It is a construction. Money flows into an apparatus that cannot or will not centrally evaluate its own output. Financial auditors have been marking exactly this gap for years. The political response is not to close the gap but to widen it – through a second, open-ended special fund regime for defense that adds a further layer to an already control-poor flow of funds.

Strategic Conclusion

The situation as it presents itself in early May 2026 can be summarized in three sentences. The federal government’s supreme audit institution has for four years systematically warned that the construction of Bundeswehr financing – through special funds, collective budget lines, and sectoral exemptions – undermines fiscal control. The Federal Ministry of Defense cannot as of March 1, 2026 centrally evaluate what has become of the 111 billion euros from 47,000 procurement contracts. That same federal government on April 29, 2026 approved a budget framework that more than doubles defense expenditures by 2030, contains an open-ended sectoral exemption from the debt brake, and drives the federal debt stock to 2.7 trillion euros by 2029.

The citizen to whom spending restraint is simultaneously being communicated on pensions, healthcare, elderly care, infrastructure, and social security is financing this system twice. Once now, through current taxes. Once later, through repayment of the debt being taken on today. The interest on that debt will consume nearly one in every eight euros of the entire federal budget by 2029.

What is most remarkable about this situation is not the political will to rearm. That is a matter for democratic debate. What is remarkable is the willingness to entrust an apparatus with an additional 80 billion euros per year without first rigorously establishing why the previous 111 billion euros failed to produce a sustainable fighting force. The answer to that question has been on paper at the federal government’s own audit institution since 2022. It was read. It was filed. And it was translated into a budget framework decision that doubles down on the very model it warned against.

Kay Scheller, the outgoing president of the Federal Court of Audit, summarized it before his departure in the language his office permits: “A security- and defense-policy-driven ‘Whatever it takes!’ must not become ‘Money is no object!'” The budget framework decision of late April 2026 leaves open the question of whether that sentence was intended as a warning – or as a sober description of what is already standard practice.

Michael Hollister
is a geopolitical analyst and investigative journalist. He served six years in the German military, including peacekeeping deployments in the Balkans (SFOR, KFOR), followed by 14 years in IT security management. His analysis draws on primary sources to examine European militarization, Western intervention policy, and shifting power dynamics across Asia. A particular focus of his work lies in Southeast Asia, where he investigates strategic dependencies, spheres of influence, and security architectures. Hollister combines operational insider perspective with uncompromising systemic critique – beyond opinion journalism. His work appears on his bilingual website (German/English) www.michael-hollister.com, at Substack and in investigative outlets across the German-speaking world and the Anglosphere.

Sources

Federal Court of Audit / Federal Commissioner for Economic Efficiency in Public Administration (BWV)

1. Federal Court of Audit – Special Report “Need for Action at the Bundeswehr” (May 27, 2025): https://www.bundesrechnungshof.de/SharedDocs/Downloads/DE/Berichte/2025/bundeswehr-volltext.pdf?__blob=publicationFile&v=3
2. Federal Court of Audit – Press release on the special report: https://www.bundesrechnungshof.de/SharedDocs/Pressemitteilungen/DE/2025/bundeswehr.html
3. Federal Court of Audit – Statement by Kay Scheller on the special report: https://www.bundesrechnungshof.de/SharedDocs/Statements/DE/2025/bundeswehr.html
4. Federal Court of Audit – BWV opinion “Framework figures for the 2027 federal budget and financial planning 2028–2030” (April 20, 2026): https://www.bundesrechnungshof.de/SharedDocs/Downloads/DE/Berichte/BWV-Veroeffentlichung/bwv-eckwerte-2027.pdf?__blob=publicationFile&v=4
5. Federal Court of Audit – Brief report “Federal Budget 2026 under scrutiny”: https://www.bundesrechnungshof.de/SharedDocs/Kurzmeldungen/DE/2025/einzelplananalyse_2026/epa-2026-kurzmeldung.html
6. Federal Court of Audit – Report on the Bundeswehr special fund economic plan (October 2022): https://www.bundesrechnungshof.de/SharedDocs/Downloads/DE/Berichte/2022/sondervermoegen-bundeswehr-oktober-volltext.pdf?__blob=publicationFile
7. Federal Court of Audit – BWV publications overview: https://www.bundesrechnungshof.de/DE/6_der_bwv/1_der_bwv_veroeffentlichungen/veroeffentlichungen_node.html

Federal Government / Federal Ministry of Finance

8. Federal Ministry of Finance – Press release on the 2027 budget framework decision (April 29, 2026): https://www.bundesfinanzministerium.de/Content/DE/Pressemitteilungen/Finanzpolitik/2026/04/2026-04-29-eckwerte-bundeshaushalt-2027.html

Reporting on the Bartsch parliamentary inquiry / Federal Press Conference

9. Berliner Zeitung – “Bundeswehr procurement: 111 billion euros spent – where the money went is unclear”: https://www.berliner-zeitung.de/article/bundesregierung-in-erklaerungsnot-wo-sind-all-die-milliarden-euro-fuer-aufruestung-geblieben-10033538
10. WirtschaftsWoche – “Bundeswehr: Defense contracts worth 111 billion since 2022, per government”: https://www.wiwo.de/politik/deutschland/bundeswehr-seit-2022-ruestungsvertraege-fuer-111-milliarden-laut-regierung/100220065.html
11. t-online – “Government: Defense contracts worth 111 billion since 2022”: https://www.t-online.de/finanzen/boerse/ticker/regierung-seit-2022-ruestungsvertraege-fuer-111-milliarden/0DB934002AE28CB4/
12. Apollo News – “Defense ministry unable to explain where Zeitenwende funds were spent”: https://apollo-news.net/verteidigungsministerium-kann-nicht-erklaeren-wofuer-die-zeitenwende-mittel-ausgegeben-wurden/

Reporting on the 2027 budget framework and debt dynamics

13. Tagesspiegel – “Dangerous debt dynamics: Court of Audit accuses federal government of structurally excessive expenditure”: https://www.tagesspiegel.de/wirtschaft/gefahrliche-verschuldungsdynamik-rechnungshof-wirft-bund-strukturell-zu-hohes-ausgabenniveau-vor-15501360.html
14. Junge Freiheit – “The federal government is living beyond its means”: https://jungefreiheit.de/wirtschaft/2026/der-bund-lebt-ueber-seine-verhaeltnisse/
15. Epoch Times – “2.7 trillion euros by 2029? Federal Court of Audit warns of dangerous debt trajectory”: https://www.epochtimes.de/politik/deutschland/27-billionen-euro-bis-2029-bundesrechnungshof-warnt-vor-gefaehrlicher-schuldenentwicklung-a5466210.html
16. Table.Briefings – “Budget 2027: Why the framework figures leave crucial questions open”: https://table.media/berlin/talk-of-the-town/haushalt-2027-warum-die-eckwerte-entscheidende-fragen-offen-lassen
17. DBwV – “Framework decision on the 2027 federal budget and financial planning through 2030”: https://www.dbwv.de/aktuelle-themen/blickpunkt/beitrag/eckwertebeschluss-zum-bundeshaushalt-2027-und-finanzplanung-bis-2030
18. RiskNET – “Early warning signal for declining fiscal resilience”: https://www.risknet.de/themen/risknews/fruehwarnsignal-fuer-sinkende-fiskalische-resilienz/

Heise / Reporting on the 2025 special report

19. heise online – “Digitalization: Federal Court of Audit identifies need for action at the Bundeswehr”: https://www.heise.de/news/Digitalisierung-Bundesrechnungshof-sieht-Handlungsbedarf-bei-der-Bundeswehr-10418184.html

Background: Bundeswehr special fund (historical context, Court of Audit reports 2022)

20. Wikipedia – “Sondervermögen Bundeswehr” (citing Court of Audit reports of April 14, 2022 and May 12, 2022 to the budget committee): https://de.wikipedia.org/wiki/Sonderverm%C3%B6gen_Bundeswehr

Author’s prior analyses on Bundeswehr operational status

21. Michael Hollister – “Siegfähig” (December 28, 2025): https://www.michael-hollister.com/de/2025/12/28/siegfaehig/
22. Michael Hollister – “Kriegstüchtig auf dem Papier, Siegfähig in der Planung” (January 4, 2026): https://www.michael-hollister.com/de/2026/01/04/kriegstuechtig-auf-dem-papier-siegfaehig-in-der-planung/

© Michael Hollister – All rights reserved. Redistribution, publication or reuse of this text requires express written permission from the author. For licensing inquiries, please contact the author via www.michael-hollister.com.

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