Federal Budget 2024: Special Funds Drive Future Quota // ZEW Study Investigates Investments in the Country’s Future

ZEW Study Investigates Investments in the Country's Future

ZEW researchers analysed future expenditure in the 2024 federal budget.

In 2024, the future quota attained the highest value since 2018: With 21.3 per cent of federal spending, around one in five euros of the total federal budget was dedicated to future-oriented tasks. However, this focus is driven by the special funds earmarked for digital infrastructure, climate action and transformation as well as German defence spending. When considering solely the core budget, the future quota noticeably declined: It was down at 18.0 per cent, after 19.8 per cent in the previous year. These are the findings of a study conducted by ZEW Mannheim and funded by the foundation Strube Stiftung.

"Shifting future challenges to separate funds outside the core budget can have a discouraging effect on political ambitions to mobilise resources for digitalisation, climate action or defence in the core budget. This pattern is obvious in the 2024 budget: The more future-oriented impulses created by the off-budget funds were almost completely offset by a shrinking future quota in the core budget," says Professor Friedrich Heinemann, head of ZEW's Research Unit "Corporate Taxation and Public Finance".