German Parliament Approves EUR4.47 Billion Budget for Digital Ministry in 2026

The German Bundestag has authorized a budget of EUR4.47 billion for the Federal Ministry for Digital Affairs and State Modernization (BMDS) for the year 2026. This funding marks a significant development, as it is the first time the ministry has been allocated a dedicated, comprehensive financial plan. The move underscores the growing importance of digital transformation within Germany's governmental and administrative structures.

The newly approved budget is structured around two main pillars. The first consists of the core budget, which is set at approximately EUR1.36 billion. This portion will primarily support the expansion and maintenance of IT infrastructure across federal government agencies. Nearly EUR956.2 million is earmarked specifically for the provision, modernization, and security of central information technology systems. In addition, around EUR222.4 million will be invested in advancing digital policy, fostering innovation, and strengthening digital connectivity. These funds are intended to stimulate the adoption of cutting-edge technologies such as artificial intelligence, support the rollout of advanced network solutions, and enhance Germany's digital sovereignty.

The second, and larger, segment of the budget draws from a special fund dedicated to infrastructure and climate neutrality, providing EUR3.11 billion. A substantial portion of this, nearly EUR2.3 billion, will be directed towards the expansion of broadband infrastructure, including high-speed fiber networks. Some of this funding is designed as multi-year commitments to ensure long-term project continuity. The plan also allocates EUR200 million to support the ongoing rollout of mobile networks, aiming to improve coverage and capacity nationwide. This investment reflects a sustained commitment to closing connectivity gaps and meeting the growing demand for reliable digital services in both urban and rural areas.

Another major focus is the digitalization of public administration, with a total of EUR657 million set aside for this purpose. Within this segment, significant funding is directed towards the development of a European Union digital identity ecosystem and the EUDI-Wallet, which receives EUR162 million. The citizen account platform is allocated EUR256 million, while register modernization projects receive EUR194 million. These initiatives are intended to streamline administrative processes, improve service delivery, and provide citizens with secure, user-friendly access to digital government services.

In tandem with the budget approval, the BMDS and the Federal Ministry of Finance have agreed on a framework for the future of the Federal Information Technology Center (ITZBund). Under this new arrangement, the Digital Ministry will assume responsibility for key IT service functions supporting federal administration. The financial resources for these services will be integrated into the BMDS's own budget at a later date, further consolidating the ministry's role as the central authority for federal digital infrastructure and modernization efforts.

The overall federal spending plan for 2026 is set at EUR524.54 billion, representing an increase of EUR4.07 billion compared to the previous government draft. The 2025 budget is projected at EUR502.55 billion. The dedicated funding for digitalization reflects the government's intention to accelerate digital transformation across sectors, enhance the efficiency and security of public services, and maintain Germany's competitiveness in the evolving digital landscape.

The approval of this budget is widely seen as a pivotal step towards modernizing Germany's digital infrastructure and public administration. By providing targeted investments in broadband, IT systems, and digital services, the government aims to create a more connected, efficient, and secure digital environment for businesses and citizens alike.