"Shaping the energy reforms, stimulating growth, consolidating the public-sector budget"
The 2014 budget of the Federal Ministry for Economic Affairs and Energy is worth an overall 7.418 billion euros (2013: 6.119 billion euros; 2nd draft budget: 7.407 billion euros). Most of the increase compared to the previous year is a consequence of the ministry's taking on responsibility for the energy reforms, low-carbon retrofitting of buildings, and for the new Länder. Based on the administrative agreements concluded between the Federal Ministry for Economic Affairs and Energy, the Federal Ministry of the Interior, the Federal Ministry for the Environment, Nature Conservation, Building and Nuclear Safety, and the Federal Ministry of Transport and Digital Infrastructure on their new division of responsibilities, parliament has approved some 6.1 million euros of additional personnel and administrative expenditure by the Federal Ministry for Economic Affairs and Energy (budget items 0910 and 0911), whilst lowering total expenditure on public relations and specialist information (budget items 0910 and 0911) by a total of 1.3 million euros.
By providing investments and funding, the Federal Ministry for Economic Affairs and Energy is to foster growth, innovation, and employment. Its main focus will be on implementing Germany's energy reforms - the Federal Government's key project for this parliament. Spending on research and development is being continued at a high level. The Joint Federal/Länder Scheme for the Improvement of Regional Economic Structures is a tried-and-tested regional-policy instrument designed to foster investment. Funding for the scheme has been increased compared to the government's draft budget and is set to rise further as of 2015, in line with what is set out in the Coalition Agreement.
Go to individual policy areas:
Innovation, technology and new mobility
- Promoting innovation and providing advice on investments
The main instrument for promoting innovation within the 'German Mittelstand' is the Central Innovation Programme for SMEs (ZIM), which will continue to operate with a large budget of 513 million euros, of which a minimum of 40% is to be allocated to companies in the New Länder.
- Research infrastructure
Some 200 million euros has been set aside to fund the research infrastructure available to SMEs. This funding will be used to support pre-competitive research work that offers high potential for implementation, and also supports projects conducted by external, non-profit-making research establishments in the New Länder which do not receive any basic state funding.
- Transfer of technologies and innovation
Under the TuIT umbrella programme, some 30 million euros is available to support the transfer of technology and innovation. This includes funding the SIGNO patent initiative and for advancing standardisation.
- New mobility
Some 97 million euros will be made available to extend the programmes designed to support R&D work in the areas of maritime technology and transport technologies. The funding for transport technologies totals around 48 million euros.
Aerospace and the German Aerospace Center (DLR)
The 2014 budget for promoting research in the aerospace sector - a particularly high-tech industry - will be around 157 million euros. Over the next few years, the Federal Government will be providing up to 170 million euros in funding for research approved this year under the Fifth Aviation Research Programme, in order to create a research environment for civil aviation that is internationally competitive, and to safeguard highly-skilled jobs in Germany.
The space sector is to receive some 1.25 billion euros in 2014, including the basic funding for the German Aerospace Center (DLR) and the support for research into aviation, energy, and transport. Some 272 million has been allocated to the national space programme. The budget for international co-operation within the European Space Agency (ESA), has been stabilised at nearly 634 million euros, which is quite a high level.
- Information and communication technology
The budget estimate for information and communication technology in 2014 is around 67 million euros. Some funds previously administered by the ministry have been shifted to the Federal Ministry of Transport and Digital Infrastructure. The Federal Ministry for Economic Affairs and Energy primarily focuses on promoting the development of new ICT applications and services based on convergence and on encouraging the widespread take-up of state-of-the-art ICT applications in SMEs and the crafts sector. The tasks linked to the "digital economy" have been subsumed under a new budget title. Here, the issue of IT security is a particular focus.
SMEs: Start-up, grow, invest
Germany: a nation of entrepreneurs
A total of 67 million euros has been earmarked to fund innovative start-ups. The EXIST funding programme aims to establish a culture of entrepreneurship at universities and research establishments and to increase the number of spin-offs from scientific institutions.
The INVEST programme for business angels aims to strengthen the venture capital market in Germany. A total of 23 million euros has been earmarked for the programme in 2014.
In addition to this, funding for technology-driven start-ups will also be made available from the High-tech Start-up Fund, which, since 2013, has been entirely financed by the ERP Special Fund. Over the 2014 to 2016 period, the ministry will merely provide an annual 5 million euros in fixed allocations to the ERP. A further 5 million euros is available for other projects that are part of the "Germany - a nation of entrepreneurs" campaign.
Closing the skills gap / vocational training and continuing education
Some 14.5 million euros of the 2014 budget have been set aside to ensure a secure supply of skilled labour. The campaign to attract qualified professionals from abroad, which was launched in 2012 as part of the efforts of the Federal Ministry of Labour and Social Affairs, the Economic Affairs Ministry and the Federal Employment Agency to recruit skilled workers from abroad, is being continued in 2014 and to receive 4 million euros worth of funding.
The vocational training programme (funding totalling approx. 74 million euros) supports cross-company courses in the crafts sector, and helps to establish, modernise, and equip cross-company training centres for trade and industry.
- Promoting the regional economy
Some 583 million euros will be available in 2014 to promote investment under the "Improving Regional Economic Structures" scheme that is run jointly by the Federation and the Länder. Together with the co-funding provided by the Länder, a total of 1.2 billion euros will be available for structurally-weak regions, to be used to support new investment projects by trade and industry and measures that seek to improve local commerce-related infrastructures.
- Promoting business skills and expertise
The financial envelope for the newly packaged "promotion of business skills" programme is worth approx. 39 million euros. It consists of various measures to support small and medium-sized enterprises in the early use of external, qualified expertise on all questions of business management.
- Potential in the services market
Some 7.4 million euros of the 2014 budget has been earmarked to support and develop up-and-coming lead markets in the services sector and to harness the potential of the cultural and creative sectors, e-health, tourism and others.
Energy and sustainability
- Research and development projects
The 2014 budget provides approx. 315 million euros for the implementation of the 6th Energy Research Programme, which supports research and development in the fields of energy efficiency, renewable energies, and nuclear safety.
- Improving energy efficiency
Some 30 million euros will again be available for measures that seek to improve energy efficiency - first and foremost for independent energy consultancy services for SMEs and private households.
- Individual measures promoting the use of renewable energy
A total of approx. 261.4 million euros will be available for the market incentive programme (MAP) for renewable energy installations, particularly those designed for the heating market and for harnessing electricity from geothermal energy and biomass, and for the running of the EEG Clearing Unit.
Phasing out subsidies for hard coal / rehabilitating mines (Wismut GmbH)
Based on the agreement to phase out subsidies for hard coal mining, a total of 1.29 billion euros has been made available for hard coal mining and for the re-adaptation benefits paid out to older employees leaving the industry. The German Hard Coal Corporation (RAG) is expected to increase its revenues from the sale of German hard coal, because of high world market prices. This is expected to lower the need for subsidies for hard coal by 200 million euros in 2014 and 2015, and by 50 million euros in 2016, compared to the respective financial ceilings set out in the Hard Coal Funding Act. These measures are without prejudice to the Agreement of Coal of 7 February 2007.
Funding of 147 million euros has been allocated for the ongoing rehabilitation and revegetation of the former uranium mining sites in Saxony and Thuringia by Wismut GmbH, including 7 million euros for the rehabilitation of former mines in Saxony
- Energy-efficient retrofitting of buildings
In 2014, the Federal Ministry for Economic Affairs and Energy took over responsibility for the energy-efficient retrofitting of buildings from the Federal Ministry of Transport and Digital Infrastructure. The budget title for this area was combined with two other titles from the ministry's portfolio to form a new group of budget titles. Some 790 million euros has been earmarked for energy-efficient construction and the retrofitting of buildings under the KfW "CO2 Buildings Rehabilitation Programme". The projects in question were approved in the period up to 2011. The rehabilitation programme is a key element of our energy reforms and a vital instrument for the Federal Government as it works towards its energy and climate targets for buildings. All funding for projects approved under this programme after 2011 will be financed exclusively by the Energy and Climate Fund (see below).
Opportunities afforded by globalisation
- Breaking into markets abroad
The various export promotion measures have been packaged together to create the "Programme to develop foreign markets" (approx. 83 million euros). The new programme consists of various export initiatives, trade fair stands, the manager training programme, and Germany's EITI membership (Extractive Industries Transparency Initiative).
- Services provided by GTAI
Germany Trade and Invest (GTAI), the German government agency tasked with promoting foreign trade and inward investment, also has an important role to play. The government will supply a total of approx. 62 million euros in funding for GTAI and the network of bilateral chambers of commerce.
- Other spending approved
Further to this, this chapter of the ministry's budget also provides funding for the long-term, large-scale projects entitled "G8 partnership with Russia to dismantle decommissioned nuclear submarines from Russia's Northern Fleet" (32 million euros) and "Construction of an urban railway in Ho Chi Minh City" (10 million euros), as well as Germany's participation in World Expositions (16.1 million euros), the country's membership in international organisations based outside Germany (including the WTO, ITU and OECD), and the institutional support granted to the German National Tourist Board (GNTB) (28 million euros). One million euros has been earmarked to support the economic reform process that is taking place in Egypt and Tunisia (transformation partnerships).
Other spending approved
In addition to expenditure on communicating and evaluating economic policy and technology policy projects, chapter 0910 provides some 45 million euros for research and for the Federal Government's contribution to the budgets of the 8 institutions that are members of the Gottfried Wilhelm Leibnitz Scientific Association and for which the Federal Ministry for Economic Affairs and Energy has been designated as responsible government agency, and for pilot and research projects conducted on behalf of the Federal Government Commissioner for the Affairs of the New Federal States (formerly based at the Federal Ministry of the Interior).
When it comes to implementing the budget, a global spending cut of approx. 70 million euros must be achieved in addition to the five-million-euro reduction that parliament has already made.
For more detailed information on the budget, please refer to the table.
Energy and Climate Fund
In addition to the funding provided by the ministry, there will be a total of 1.193 billion euros worth of funding from the Energy and Climate Fund, making this fund the central financial instrument for the implementation of the energy reform. Of this funding, just under 55 million euros will be available for research into energy efficiency, 132 million euros for the Energy Efficiency Fund, 72 million euros for electric mobility, and 5.6 million euros for international energy and raw materials partnerships. In addition to these measures, a total of 350 million euros in grants will be available for energy-intensive companies in 2014 to offset increases in electricity prices due to emissions trading (compensation for electricity prices). Now that the ministry's energy portfolio has been expanded, it has also been allocated funding for the energy-efficient retrofitting of buildings (just under 409 million euros), for R&D work in the field of renewables (just under 59 million euros), for the market incentive programme for renewables (MAP) (just above 107 million euros) and for promoting cross-border co-operation within the context of the EU Renewables Directive (some 4.2 million euros).