With its new fiscal policy course, the German government has paved the way for the comprehensive modernisation of public infrastructures. In addition to traditional fields of action such as mobility, energy and digitalisation, there is an increasing focus on requirements arising from security policy and geopolitical developments.
For public bodies – from municipalities and state authorities to federal institutions – new room for manoeuvre is emerging. At the same time, the requirements for planning security, speed of implementation and legal compliance are increasing.
Our 10 questions and answers provide orientation in the area of conflict between modernisation, security and sustainability.
Mathias Oberndörfer
Managing Partner, Head of Public Sector
KPMG AG Wirtschaftsprüfungsgesellschaft
Focus topics
10 questions and answers for the public sector
The focus is on extensive modernisation measures in safety-critical and future-relevant areas. These include, in particular, the renovation of transport routes, the upgrading of bridges, the expansion of public transport, the development of digital administrative infrastructures and investments in energy efficiency and security of supply. There is also an increased focus on the resilience of critical infrastructures - for example in the healthcare system, water or electricity supply.
The special fund in accordance with Article 143h of the Basic Law opens up new financial scope for investments that were previously held back by budget limits. It is intended exclusively for additional measures – i. e. for projects that were previously neither planned nor financed. Public bodies can now invest more specifically in transformation, digitalisation and infrastructure projects, provided they are eligible for funding and strategically embedded. At the same time, economic plausibility and a compliant design in accordance with budgetary, procurement and state aid law are still required.
Digitalisation is a key lever for increasing efficiency and reducing the burden on the administration. Digital authorisation processes, automated workflows, central portals and cloud-based specialist procedures enable leaner and faster processes. The aim is to significantly reduce processing times, increase transparency and improve the quality of implementation at the same time. Initiatives such as the "Deutschland-Stack" or the eID wallet form the technological framework for this.
Many programmes at federal level – for example as part of the DigitalPakt, the climate investment offensive or the federal funding for efficient buildings (BEG) – are explicitly aimed at federal states and municipalities. The special fund has also earmarked 100 billion euros for investments by the federal states and local authorities. As a rule, the prerequisite is a qualified project application with a clear definition of objectives, financing structure and benefit argumentation. Early project development, plausibility checks and an award strategy are crucial for funding success.
Infrastructure projects are increasingly being evaluated from a safety-related perspective. These include, for example, the load-bearing capacity of bridges for military transport, the marking of marching routes with MLC signs, the expansion of rest areas along strategic transport routes or requirements for emergency power supply, cyber security and redundant communication. These requirements are not only incorporated into the technical design, but can also have an impact on eligibility for funding and planning priority.
Public procurement law remains the central framework for transparency, equal treatment and economic efficiency. At the same time, digital procurement platforms (e. g. e-tendering, DTVP) and new instruments such as innovation partnerships are increasingly being utilised. Efforts are being made to simplify procedures for major strategic projects – for example by recognising equivalent international certifications or by easing the requirements for urgency and systemic relevance. Nevertheless, careful and legally compliant procedural design remains essential.
PPP models can leverage efficiency potential, especially for complex projects in the areas of transport, education or IT infrastructure. The early involvement of private expertise, technologies and financing models enables cost-effective implementation and a risk-conscious project structure. This requires a sound economic feasibility study, clear governance structures and a long-term contract design that ensures both controllability and flexibility.
Technical interoperability, open interfaces and compatibility with European and national standards are crucial for sustainable investments. This applies in particular to digital administration platforms, cloud infrastructures, security systems and AI applications. Standardisation initiatives such as Gaia-X, the EU AI Act or standardisation specifications in the area of IT security provide guidance. If you want to realise future-proof projects, you should take these standards into account at an early stage.
The implementation of the investment offensive requires new skills – in technology, project management, public procurement law and digital transformation. The federal government and many federal states are specifically promoting qualification measures, including through administrative academies, e-learning platforms and cooperation with universities. The development of interdisciplinary project teams, the establishment of transformation offices or the onboarding of external expertise can also support the development of expertise.
Close cooperation between the federal government, federal states and local authorities is crucial, especially when it comes to interdisciplinary topics such as climate adaptation, digitalisation or security provision. Joint steering committees, coordinated planning approaches and centralised platforms for project tracking ensure synergies and prevent frictional losses. Funding is also increasingly linked to a willingness to cooperate and integrated planning approaches.