Pioneer Briefing US Edition

8 Expensive Findings from the Finance Ministry‘s Latest Cost Report


Good Morning,

The federal government relocated to Berlin in the summer of 1999 under the Berlin/Bonn Act. Since then, ministries have been split between two locations, with six headquartered in the Rhineland. This setup requires constant movement of officials and documents, resulting in additional expenses.

According to the Ministry of Finance's departmental cost report for 2023, obtained by our colleague Christian Schlesiger, the government spent €9.12 million on this setup in 2023 alone. €9.12 million represents a 64 percent increase in spending compared to 2021. However, this number is in line with the 2019 expenditures. The main cost drivers were official travel, as well as communications equipment and software.

Federal Ministry of Finance in Berlin © imago

Other findings from the March 21, 2024 report include:

A growing number of officials: Berlin added approximately 1,861 positions/posts over the past two years, an increase of 1.5 percent from 2021. In Bonn, the number of positions increased by about 210. As a result, the share of positions in Bonn is 27.2 percent, while the share in Berlin is 72.8 percent.

On the road again: In 2023, there were 11,202 official trips, with an average of 47 commuting officials per workday, costing the state €5.19 million, or €21,635 per workday - an increase of 255 percent compared to the pandemic year of 2021.

WebEx instead of Eurowings: The number of flights, car trips or train rides decreased by 44 percent compared to the pre-pandemic year of 2019, for a total of 8,647 fewer trips —- reflecting the ongoing impact of the pandemic.

Less is more: The average cost of an official trip from Bonn to Berlin, however, increased significantly compared to 2019. This is due in part to officials traveling primarily by train, which requires overnight stays.

Collaboration: "Strategically important and politically relevant tasks" are now concentrated in Berlin, and efforts are being made to have Berlin-based staff attend meetings instead of their Bonn counterparts, especially in committees.

Bonn Bubble: Two ministries have more staff in Bonn than in Berlin: Agriculture (586 positions in Bonn versus 501 in Berlin) and Research (863 in Bonn versus 569 in Berlin).

Commuting Champions: Defense officials under Boris Pistorius commuted 2,097 times last year — the most of any ministry. They also favor air travel, which accounts for 17 percent of travel expenses. The Department of Foreign Affairs (11 percent) and the Department of Development Aid (10 percent) also prefer to fly.

Defense Minister Boris Pistorius issues a press release on the Taurus leak.  © dpa

The Taxpayers' Association (BdSt) has long criticized this setup, calling for an "end to the divided ministerial bureaucracy." According to our colleague Paolina Longk, they argue that this system is wasteful and that commuting is "resource-intensive and harmful to the environment."

Ultimately, the question is simple: Are we better governed from Berlin AND Bonn?

The answer is no. We are essentially spending money to make things worse.

  • The President of the Federation of German Industries, Siegfried Russwurm, lashes out at Chancellor Scholz.

  • In his memoirs, the late Christian Democratic Union (CDU) politician Wolfgang Schäuble sheds light on Edmund Stoiber's secret plans

  • Klaus Mäkelä (Finnland) becomes the new principal conductor of the Chicago Symphony Orchestra at the age of 28.

Former Chancellor Gerhard Schröder in his office in Hanover © dpa

Documentary: On the occasion of former Chancellor Gerhard Schröder's 80th birthday (April 7th), ARD will broadcast a 60-minute documentary that offers an insightful portrait of the statesman. Instead of tearing Schröder down, the movie tries to understand him.

NDR (North German Broadcasting) Reporter Lukas Stratmann followed Schröder and his wife, So-yeon Schröder-Kim, for several months. The documentary delves into various facets of Schröder's personality - the former chancellor, the maverick, the charmer.

Gerhard Schröder with his wife Kim Soyeon © dpa

The film naturally touches on Schröder's friendship with Vladimir Putin. He has made it clear that he considers the war a mistake. However, as he candidly states:

Well, there's not much more I can do. Someone who was once a head of government, albeit with a special relationship with the Russian president, has limited options.

After Russia attacked Ukraine, Schröder continued to support Putin (including his role as chairman of the board of Nord Stream 2). Consequently, the Social Democratic Party (SPD) withdrew funding for his office in Berlin and he is no longer invited to party conventions.

Vladimir Putin and Gerhard Schröder (2018) © dpa

In the documentary, Schröder takes a swipe at Kevin Kühnert:

These are simply pathetic figures causing such issues. What's there to ponder? If a secretary-general deems it necessary and bears responsibility – just a hapless individual. Should I be bothered? - No. The SPD is bigger than these individuals.

Kevin Kühnert © dpa

He also criticizes the Green Party's foreign minister for harshly criticizing China and calling its leader a dictator:

I prefer not to comment on the current foreign minister's actions. I believe it's a regrettable trend, damaging diplomatic relations not only between Germany and China but more broadly.

The documentary delves into the story of a man whose own party seeks to distance themselves from him. It acknowledges and celebrates his achievements, including the Agenda 2010 reforms and his firm "no" to the Iraq war.

In the documentary: Schröder defends friendship with Putin. © dpa

He remains as contradictory as ever. He sees himself as a former politician but still likes getting involved. He claims he doesn't want to comment, yet he always does so. He wants to be left alone, yet he seeks the limelight. He finds his critics intrusive, yet he constantly steps on their toes.

As we preach to school children: Be yourself. Be completely yourself. That's who he was as chancellor, and that's who he is today. That's how he sees himself, and that's how he wants to be seen:

This is part of my political life, but also my private life. Sometimes, I'm a little different from others.

Wolfgang Schäuble, former President of the German Bundestag © dpa

In his memoirs, excerpts of which have been published by Stern magazine, the late Christian Democratic Party (CDU) politician Wolfgang Schäuble reveals new details about the secret plans of former Christian Social Party (CSU) leader Edmund Stoiber. Specifically, the fact that Stoiber allegedly wanted to oust Angela Merkel from the chancellorship.

The context for this revelation lies in the Union's internal struggles during the refugee crisis of 2015. CSU leader Horst Seehofer openly criticized Merkel, with Stoiber reportedly backing him. According to Schäuble, Stoiber had high hopes for him:

He [Stoiber] wanted to convince me to overthrow Merkel and become chancellor himself.

Wolfgang Schäuble and Edmund Stoiber (2002) © dpa

But Schäuble, reverently, refused to be persuaded to overthrow Merkel. His reasoning:

As with Kohl decades earlier, I remained steadfast in my conviction that overthrowing our own chancellor would only harm our party in the long run without really solving the problem. That was my understanding of loyalty, which may seem outdated by today's standards.

NATO Secretary General Jens Stoltenberg © dpa

New aid package: On the occasion of NATO's 75th anniversary, the alliance's secretary general wants to secure new support for Ukraine. Jens Stoltenberg proposes that the 32 member states allocate $100 billion for defense against Russia.

We need more money, we need new money and we need it to last many years.

The proposal: Stoltenberg called for a "robust NATO framework with financial commitments." He did not provide details, but diplomats say the proposal is for $100 billion over five years. The money would be used for arms supplies and financial assistance. However, the exact amount may still be subject to negotiation.

Olaf Scholz and Siegfried Russwurm © dpa

Siegfried Russwurm, president of the Federation of German Industries (BDI), has had enough. In an interview with the Süddeutsche Zeitung, Russwurm dismisses the government's performance in the first half of its term as inadequate:

These were two wasted years - even though some important decisions had already been wrongly made.

Christian Lindner and Robert Habeck © dpa

However, the criticism isn't equally directed at all government members. The BDI regularly contacts Economics Minister Habeck and Finance Minister Lindner. It's a different story with Chancellor Olaf Scholz:

Recently, the chancellor has often responded with the quote: 'Complaint is the businessman's song.' While this may refute our analyses, it also suggests that the seriousness of the situation is apparently underestimated in the Chancellery.

Conclusion: Despite Olaf Scholz's recent attempts to portray himself as a peacemaker, his handling of the economic decline in Germany is causing his list of friends in the business community to dwindle from few to almost none, and isolation is never a good idea.

JLL CEO Christian Ulbrich © imago

Last year was unforgettable for the real estate industry. Potential buyers found prices too high, while sellers found them too low. As a result, 2023 was the worst year for real estate investment since 2011, according to an analysis by international real estate valuation firm Jones Lang LaSalle Inc. (JLL).

In the Pioneer Podcast, my colleague Christian Schlesiger spoke with JLL CEO Christian Ulbrich. Ulbrich takes a forward-looking approach:

We seem to have reached the bottom. And we are very hopeful that at least the second half of 2024 will be better.

Urban housing is becoming increasingly scarce and expensive. Recently, rental prices in German cities reached a new record high. One possible solution could be to build upwards. But, according to the expert:

Building high-rises means building expensively. And that doesn't solve the housing problem. What kind of residential high-rises are there in Frankfurt? They are mostly luxury apartments. The higher you build, the more expensive it gets. You need escape routes. The whole infrastructure is costly, so it's certainly not the solution for affordable housing.

Click here to listen to today’s Pioneer Podcast.

Why is this the case, and what areas offer untapped potential? Find out by listening to this morning’s Pioneer Podcast.

Klaus Mäkelä © Instagram/klausmakelaofficial

Finnish conductor Klaus Mäkelä (28) will become the new principal conductor of the Chicago Symphony Orchestra, replacing Italian Riccardo Muti, who is retiring at 82. Mäkelä will assume the position beginning with the 2027/28 season, with an initial contract term of five years. At the same time, he will become chief conductor of the Royal Concertgebouw Orchestra Amsterdam.

Riccardo Muti © imago

Age is not a decisive factor for a conductor, says Mäkelä:

If there's a musical connection, nothing else matters, whether you are old, young, tall or short.

This new job is not Mäkelä's first leading role. In the fall of 2020, he became principal conductor of the Oslo Philharmonic, and in 2021, he became the music director of the Orchestre de Paris. He intends to continue in both positions until he takes up posts in Chicago and Amsterdam.

Musical family: Klaus Mäkelä is the son of a cellist and a pianist, and his grandfather is a violinist and viola player. His younger sister dances for the Finnish National Ballet. This confirms the notion that the apple doesn't fall far from the tree.

Klaus Mäkelä © Instagram/klausmakelaofficial

Wishing you a wonderful start to your day. Stay informed. Stay with me.

Best wishes,

Pioneer Editor, Editor in Chief, The Pioneer
  1. , Pioneer Editor, Editor in Chief, The Pioneer

Editorial Team

Eleanor Cwik, Alexia Ramos, Nico Giese, Lukas Hermann & Paulina Metzler

With contributions from Luisa Nuhr & Laura Block

Translation Team

Eleanor Cwik & Alexia Ramos


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