Thuringia's Corona Energy Relief Fund Unscathed by Federal Constitutional Court Ruling, Courts Audit Confirms
In an initial assessment by Thuringia's Court of Audit, the verdict by Germany's Federal Constitutional Court on a federal fund worth billions doesn't seem to pose a significant threat to Thuringia's Corona Energy Relief Fund. A spokesperson for the Court of Audit revealed to dpa in Rudolstadt that unlike the federal level, there has been no comparable reallocation of loan-financed corona aid funds in the state.
The Thuringian Ministry of Finance heeds the advice of the Court of Audit, ensuring a clear separation between corona and energy aid funds in the state fund. This strategic move prevents loan-financed funds earmarked for one purpose from being redirected towards another.
The Federal Constitutional Court chastised the coalition government for their initial plan to allocate loans obtained due to pandemic consequences for combating the energy crisis. The ruling upholds the doctrine that state bodies cannot divert loan-financed funds earmarked for a specific purpose at will.
Beginning of Thuringia's Special Fund in 2020
Thuringia set up a special fund called the "Thuringian Pandemic Relief Fund" by the end of 2020 in response to an unprecedented crisis. The court revealed that this fund initially received a loan of 695 million euros, followed by an additional 82 million euros from the state budget at the beginning of 2022.
Subsequently, with the onset of the energy crisis, this special fund was expanded to help distribute energy aid funds in 2022. It was then renamed "Thuringian Energy Crisis and Corona Pandemic Aid Fund." The court confirms that another 350 million euros was added to the fund as part of this expansion, and this expansion is not affected by the Federal Constitutional Court's ruling as these funds were not loan-financed.
According to the Court of Audit, all 695 million euros borrowed in 2020 have been allocated to addressing the repercussions of the coronavirus crisis since the end of 2022.
Budgetary Principle Breaches Pose Question Marks
The financial auditors in Rudolstadt raise doubts about potential violations of annuality and annuality budgetary principles in the handling of the special fund. The Federal Constitutional Court's ruling against such violations of budgetary principles stipulates that emergency loan funds should only be utilized until the end of the year in which the crisis escalates.
While the Court of Audit is still assessing the full extent of the ruling's impact, all statements made thus far are preliminary.
Court of Audit Welcomes Federal Constitutional Court's Clarification
Although the Federal Constitutional Court's judgment was not entirely unexpected for the Court of Audit, it appreciates the unequivocal clarification provided by Germany's highest court. The court's decisions align with the principles it has been promoting for years, emphasizing fiscal responsibility in dealing with emergency funds.
In conclusion, Thuringia's Corona Energy Relief Fund seems to have weathered the challenge posed by the Federal Constitutional Court's ruling, thanks in part to the court's own recommendations and the separation of funds.
