The federal government supports the economy with 130 billion euros

Status: 12/30/2021 1:05 p.m.

Since the beginning of the Corona crisis, the federal government has taken 130 billion in hand to help the economy. It doesn’t stop there. Many companies also have a longer time to repay.

The federal government has supported the economy with around 130 billion euros since the outbreak of the corona pandemic. So far, aid of around 60 billion euros has been disbursed and loans of almost 55 billion euros have been granted. This emerges from a list of the Federal Ministry of Economics, which is available to the news agency dpa. There were also recapitalizations and guarantees.

Four million applications approved

Thanks to the digital application process and the good cooperation between the federal and state governments, it has been possible to approve four million applications for grants since the beginning of the pandemic, according to the paper for the state chancelleries of the states. Around 156,000 commitments were made as part of the KfW special program. In addition, there are expenses for short-time work benefits.

According to the paper, according to the Federal Employment Agency, around 24 billion euros in short-time work benefits and around 18 billion euros on social benefits from short-time work were spent in 2020 and 2021. “In close coordination with the federal states, we are doing everything we can to ensure that the aid reaches the companies quickly,” said State Secretary Sven Giegold of the dpa. “In view of the current pandemic situation, we continue to support our companies and employees so that as many companies as possible survive the crisis and the current difficult situation.”

The ministry also indicated that the business programs continued. “There is a wide instrument box available.” The bridging aid and the restart aid for the self-employed as well as the easier access to short-time work allowance have just been extended by three months to March 31 of next year. The KfW special program and the KfW express loan also ran until April 30 with increased credit limits. The KfW investment loan for municipal and social enterprises can still be applied for until June 30, 2022.

Bridging aid IV until the end of March

In view of the spread of the Omikron variant, stricter measures, delivery difficulties and a lack of planning security, many industries are not necessarily looking optimistically into the new year. In addition, rising prices are dampening Germans’ buying mood. Some federal states and business associations such as the Hotel and Restaurant Association (DEHOGA) had therefore long been calling for state support to be continued, which was originally supposed to expire at the end of the year.

At the beginning of December, the Federal Ministry of Finance and the Federal Ministry of Economics finally agreed on the extension of Bridging Aid IV and Restart Aid. The basic application requirement is still a 30 percent decline in sales due to Corona compared to the reference period 2019. The maximum funding rate of the eligible fixed costs is 90 percent with a sales decline of over 70 percent. Showmen, market people or private organizers of canceled Advent and Christmas markets can also receive an additional 50 percent equity contribution if their sales have collapsed by at least 50 percent in December.

The EU Commission also recently increased the permitted amount of financial aid by 2.5 million euros. This means that a company or group of companies can in future receive a maximum funding of 54.5 million euros across all aid programs. It is a maximum of ten million euros per month.

Repayment deadlines extended in many places

The repayment of the overpaid Corona aid as part of the “Corona emergency aid” program that ran in spring 2020 remains a point of contention. The federal and state governments had paid out the amount corresponding to the company’s estimated future income and expenditure. The repayments are now based on the actual values. A total of 287.8 million euros in federal funds are to be reimbursed to the federal states by small businesses and the self-employed, as the “Handelsblatt” recently reported.

Economics minister Robert Habeck (Greens) now wants to help the affected companies. In a letter to the ARD capital studio is available, he asked the federal states to grant appropriate deadlines for repayment. As an example, he refers to the repayment date granted by North Rhine-Westphalia on October 31, 2022, which offers companies sufficient planning security. The final reports of the federal states, which have to submit them to the federal government, should therefore not be due until the end of 2022; six months later than originally planned.

It is apparently similar in other federal states. “A welcome approach, but we have been acting like this for a long time,” said Schleswig-Holstein’s Minister of Economic Affairs, Bernd Buchholz (FDP). If too many grants are granted, the state only determines the repayment obligation and agrees long-term payment terms of sometimes six to twelve months. Mecklenburg-Western Pomerania is also using the option given by the federal government to extend the deadline for repaying the Corona emergency aid, said Minister of Economics Reinhard Meyer (SPD) today in Schwerin.

Leave a Reply

Your email address will not be published. Required fields are marked *