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Possible Integrated Federal Spending Review for Germany
Medium-term strategic priorities:
The key national and sectoral priorities outlined in
the Coalition Agreement should form the grounding for any spending review conducted at
the administrative level.
Strategic spending review:
The Federal Ministry of Finance should take the lead role in
co-ordinating a structured analytical review of existing programmes, with the objective of
assessing how well the existing structure of resource allocation corresponds with the
government’s strategic objectives; in light of the implications of the budget constraint. The
assessment should be by reference to objective efficiency and effectiveness analysis as
well as a qualitative reassessment of the relative priority of different spending programmes.
There are a number of models for:
a) who should conduct the review
– e.g. analyses conducted by line ministries themselves;
by the Federal Ministry of Finance, whether via its “mirror units” or via a specialist cadre of
evaluators; or by both in parallel;
b) who should oversee and steer the review
– e.g. a group of independent experts; the Federal
Ministry of Finance itself; a panel of senior civil servants and possibly political advisers; or
a sub-committee of the cabinet;
c) which areas should be reviewed
– e.g. a “comprehensive” approach seeking to cover the bulk
of expenditure, or at least the bulk of the discretionary elements of expenditure; or alternatively
a more selective and focused review of particular sectors; whether tax expenditures should

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BUDGET REVIEW: GERMANY
OECD JOURNAL ON BUDGETING – VOLUME 2014/2 © OECD 2015
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4. Quality, integrity, and independent input to budgeting
4.1. Independent economic input to the budget process
The German forecasting and budget process allows for a variety of opportunities for
independent (or semi-independent) institutions to participate in fiscal policy and budget
planning (see Figure 1). These include the:
●
Council of Economic Experts (
Sachverständigenrat
, est. 1963); 
●
The independent economic institutions that are commissioned to produce the Joint
Economic Forecast (est. 1950);
●
Advisory Board to the Federal Ministry of Finance (est. 1950);
●
Working Party on Tax Revenue Forecasting (est. 1955); and most recently the
●
Independent Advisory Council (est. 2013) to the Stability Council (est. 2009).
Taken separately and together, the inputs of these institutions foster greater transparency
in fiscal and economic policymaking.