2023-07-25 06:44:07
Germany needs tanks, planes, ships, ammunition and much more to strengthen its defense capability. After the start of the Russian war of aggression in Ukraine, the federal government made 100 billion euros available with a “special fund” so that the necessary items could be procured. But only a fraction of the funds have flown out so far. How can the Bundeswehr be better equipped? The Scientific Advisory Board at the Federal Ministry of Economics and Climate Protection has investigated this question. In his report, which is available to the FAZ and is to be presented this Tuesday, Robert Habeck’s (Greens) advisors have identified points where politics could start.
As the reviewers note, military procurement has long had a reputation for being slow and inefficient. The legislature reacted to this a year ago. The “Bundeswehr Procurement Acceleration Act” provides for some simplifications in procurement law. It is limited to the end of 2026. It is of exemplary importance. If the rules should prove themselves here, they could be transferred to other public procurements, the scientists point out.
Up to now it has been customary for the budget committee to be presented with expensive procurements before the contract is signed. With the special fund, a practice became a rule. “This so-called parliamentary loop leads to a merging of the legislative and executive branches,” Habeck’s advisers note. The government’s desired decision-making power includes the power to spend money. “The Parliament also does not have the factual competence to assess individual procurement processes in detail.” It would not make sense for it to build up this competence. The micromanagement of government and administration is not a legitimate task of the legislature. “The parliamentary scrutiny is intended as an additional control, but leads to the procurement process becoming more expensive, less transparent and more susceptible to lobbying, and taking longer.” The rule should be repealed.
Waiver of the public procurement tribunal?
The scientists are critical of another special regulation: the possible restriction of the awarding of contracts in favor of European cooperation projects. “If the rule takes effect, providers from other NATO countries, especially from the USA, can also be excluded. So the rule has a protectionist effect,” they write. It is a political question whether the Federal Republic wants to use the increase in the defense budget to build up new skills and capacities or to keep existing ones in the country. Such a decision should not hide behind European cooperation projects. However, the promotion of one’s own industry can only be a secondary purpose. The main purpose remains the country’s defense capability. It would be better to create a transparent rule for the promotion of one’s own industry. “For this purpose, one could, for example, give projects a defined bonus in the award decision.”
When it comes to the procurement process, the authors are in favor of speeding up the process, which gives the inferior providers the opportunity to have the process checked. The competent procurement chamber is docked with the Federal Cartel Office. In addition, there is an opportunity to lodge a complaint with the Düsseldorf Higher Regional Court. These paths are used relatively rarely. The simplest solution would be to shorten the instance process, they say. The authors suggest a waiver of the public procurement tribunal. If the immediate appeal to the Higher Regional Court should be retained, one could absolutely rule out for the defense area that it would prohibit the award until it had decided. “The result would be that the Bundeswehr can act after seven weeks at the latest.” To protect smaller providers, contracts should not be split up, but rather the selected contractor should be given the task of subcontracting. A certain proportion of the budget could also be reserved for small and medium-sized companies.
Simon Hüsgen Published/Updated: , Michaela Wiegel and Niklas Záboji Published/Updated: , Recommendations: 19 Peter Carstens, Berlin Published/Updated: , Recommendations: 15 Christoph Hein, Redbank Published/Updated: , Recommendations: 41
In general, the market for armaments is a very special one. According to the report, once the Bundeswehr has decided on a weapon system, the costs of switching to a competing product are high. Conversely, a company’s costs could be high if it had made investments in reliance on supplying the Bundeswehr. In this way, a competitive position later turns into a bilateral monopoly. The evaluators therefore propose incentive contracts that guarantee the contractor a premium if he fulfills the purpose of the contract particularly well. “Bonuses should not be limited to 5 percent of the contract value so that they can fulfill their incentive effect.”
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