The bundle paid five billion Euros too much in Corona-Emergency Aid
Quick and bureaucracy-free, the Bund intends to pay out billions in Corona aid to entrepreneurs and self-employed individuals following the onset of the Corona pandemic. However, it appears that errors have occurred - several billion Euros have reportedly been paid out incorrectly.
The German Federal Ministry of Economics estimates that approximately five billion Euros in Corona grants were paid out too generously at the start of the pandemic in 2020. Of this amount, around 3.46 billion Euros were reportedly repaid by around 550,000 companies and self-employed individuals, according to a ministry spokesperson. WDR, NDR, and Süddeutsche Zeitung reported on this previously.
The Corona grant from the Federal Government could be applied for at the beginning of the pandemic in spring 2020 for a three-month funding period. In total, the Ministry reports that around 13.6 billion Euros in federal funds were paid out.
The Corona grant was reportedly paid out quickly and bureaucracy-free to small businesses and self-employed individuals, explained the Federal Ministry. However, it was the responsibility of the states to determine how the money was distributed. The granting of funds was subject to the condition of retrospective review and potential repayment from the outset.
According to WDR, NDR, and Süddeutsche Zeitung, citing a survey, there are around 1800 legal proceedings for repayment requests in North Rhine-Westphalia alone. This is the highest number among the federal states. Baden-Württemberg follows with over 1100 claims, and there are over 5500 in total in Germany. Approximately half of the proceedings have not yet been completed.
In a statement to the Ministry, the Federal Court of Auditors criticized the approach. The experts reportedly spoke of "unclear eligibility requirements" and criticized the fact that the Ministry did not initially specify "which costs and financial expenses could be considered individually." The Ministry reportedly only pointed this out a few days after the start of the payouts. The federal states then specified the conditions for those entitled to Corona aid only after many applications had already been submitted.
The Federal Ministry of Economics is currently investigating the issue of incorrect Corona aid payments, with politics under scrutiny due to the misallocation of funds from the Federal Ministry of Economics' Corona grant. To mitigate the impact of the Corona Crisis, the Bund announced subventions for entrepreneurs and self-employed individuals, but errors led to overpayments, requiring repayments from around 550,000 companies.
