Are financial concerns influencing Germany’s road building?
A controversy is growing in Germany about future funding mechanisms for building and maintaining roads. The federal government and the 16 state governments are looking at new financing options involving the private sector, but T&E’s member VCD has criticised the direction in which the discussions are going, saying they take no account of the need to fight climate change and changing transport trends.
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Germany’s constitution gives responsibility for road building and maintenance to the federated states (Länder), with the federal government having the role of constructor and monitoring agency. But a commission set up by the German economics minister Sigmar Gabriel has recommended establishing a new federal agency responsible for long-distance roads. The Länder reject this but are not against attracting private finance in some form.
VCD’s chair Michael Ziesak said: ‘It seems the discussion is getting away from transport and traffic considerations. The aim of both the federal government and the Länder appears to be financial, with the result that their policy seems to be to put as much money into asphalt as possible.’
The issue believed to be at the root of the controversy is that the federal government is worried about the precarious state of the insurance and pensions industry, and is looking to offer it investment opportunities in order to guarantee the security of generous pension policies that the industry has already sold. Meanwhile the Länder are looking to bring in outside finance for road building and repairs.
The VCD is in principle against public/private finance partnerships for road projects, as they generally work out more expensive than state-only financing. ‘The private investors want their return on investment,’ says Ziesak, ‘and if a public/private financing model is going to cost the state more money, then that would be bordering on procurement criminality.’
The VCD also criticised the German transport ministry’s recently published National Infrastructure Roadmap for 2030, which it said provided for many new roads, and lacked environmental checks as well as alternatives solutions – particularly in light of Germany currently preparing its climate action plan for 2050.
Michael Ziesak said: ‘There’s hardly a country in the world that has such a dense network of motorways as Germany, so the combination of fighting climate change and demographic trends makes new motorways unnecessary. Any money spent on roads should be strictly limited to maintenance or even the partial dismantling of the existing network. Instead we need a doubling of rail freight because without modal shift climate targets can’t be met.’