German government: Drastic budget cuts for digitization

The budget for digitization in Germany is to be cut from 377 million euros to just three million euros in 2024. Massive effects are feared in particular for administrative digitization and the development of digital identities.

The German government is planning drastic budget cuts for digitization in the coming year, as reported by the Frankfurter Allgemeine Zeitung (FAZ). Funding for administrative digitization, in particular the Online Access Act (OZG), is to fall from 377 million euros to three million euros. This law was supposed to provide online access to administrative services by the end of 2022, but implementation has been slow.

The cuts could further hamper digital initiatives, as Schleswig-Holstein complains. The state is working on an online housing subsidy application for millions of households, but cooperation with the federal government has already been halted due to a lack of financial support.

The planned cuts have met with criticism from members of the Bundestag, including both government and opposition representatives. They criticize the lack of 575 million euros for the implementation of the planned OZG 2.0 as well as additional funds for running costs. Concerns are being raised about a standstill in digitization. For example, CDU/CSU budget politician Franziska Hoppermann criticized the government’s “disastrous digital policy” for sleeping through important visions of the future.

A spokesperson for the Digital Ministry stresses that funding for the coming year is secured – among other things, through the use of “spending residues” from previous budget years and increased funding for the FItko coordination office.

In addition to administrative digitization, other projects are also affected by the cuts, including the development of digital identities. Here, the budget drops from 60 million to 40 million euros. Digital identities are of great importance for providing citizens with legally binding identification online and facilitating processes such as banking transactions. However, there is still a lack of a clear strategy for these projects, which is also being publicly criticized.

The planned cuts shine a spotlight on the challenges and deficits in German digital policy and raise questions about future direction and implementation. Learn more.

Source: ComputerBase