- East German construction sector advocates for less bureaucratic procedures
Construction companies in eastern Germany are voicing concerns over rising bureaucratic red tape. To such an extent, a significant number of firms are shying away from tender bids due to the excessive administrative demands, as per the East German Construction Industry Association (BIVO). The organization's research revealings are compiled in a report dubbed the "Black Book."
The survey revealed that an astounding 60% of companies decided against participating in tender bids, attributing the decision to the overwhelming bureaucratic hurdles. BIVO's Managing Director Robert Momberg expressed concern over the situation, stating, "In the face of a housing shortage and crumbling infrastructure, this clearly indicates that bureaucracy isn't merely hindering projects, but also stalling urgently required construction capacities."
Moreover, a staggering 93% of companies anticipate that the bureaucratic load will remain burdensome over the past five years. Remarkably, this sentiment was shared by 82.4% of businesses in 2018, with none reporting a decrease in bureaucratic load in both years.
Momberg elaborated on the impact of bureaucracy on the industry, stating, "Our second 'Black Book' on bureaucratic load once again highlights how tasks and obligations outside the construction process are impeding the industry and augmenting construction costs." In 2020, the cumulative effort required to comply with bureaucratic tasks amounted to a staggering 3.5 billion euros.
BIVO has been advocating for regulatory relief measures since 2018, under the motto "3V - Reduce, Simplify, Connect." Their proposals include reducing approval procedures, streamlining existing processes, providing online data, establishing uniform statistics, and fostering harmonization at the EU level. Above all, Momberg emphasized the need for digitalization in administrative bodies.
However, despite vociferous calls for reform, BIVO hasn't seen any substantive improvements. "Given that our demands remain the same in 2024, it underscores the ineffectiveness of previous political measures aimed at reducing bureaucracy. Despite numerous commitments, task forces, and bureaucracy relief laws, the number of regulations and their corresponding costs have risen," explained Momberg.
For the "Black Book", BIVO surveyed its member companies during the first and second quarters of this year. The East German Construction Industry Association represents the interests of 260 construction firms employing around 20,000 workers across Berlin, Brandenburg, Saxony, and Saxony-Anhalt.
The East German Construction Industry Association (BIVO) has been urging for regulatory relief measures since 2018, proposing reductions, simplifications, and digitalization to alleviate bureaucratic burdens. Surprisingly, The Commission, responsible for implementing these reforms, has not made significant progress, as noted by BIVO's Managing Director Robert Momberg.
