Financial support
Financial subsidies are capital or contingent liabilities made available from the budget of the public sector for legal or natural persons , which serve to achieve certain political or economic goals. The scope, type and origin of financial state funding have reached a dimension that even funding experts can hardly overlook.
General
Companies, corporations or private individuals who are unable to meet their capital requirements through self-financing or external financing receive state aid under certain conditions. These prerequisites are laid down in funding programs that contain personal and factual funding conditions. Capital bottlenecks exist particularly when setting up companies , start-ups , in structurally weak areas or during corporate crises . Funding funds are therefore alternative financing instruments to equity and debt capital . These are grants or special-purpose grants from the budget of the public sector for legal or natural persons in order to achieve certain political or economic goals.
The Confederation met by Art. 104b GG incumbent on him constitutional conveying task by the countries financial assistance for particularly important investments in countries and municipalities / associations of municipalities granted,
- to avert a disruption of the macroeconomic equilibrium or
- to compensate for different economic power in the federal territory or
- to promote economic growth
required are. In the event of natural disasters or exceptional emergency situations which are beyond the control of the state and which have a significant negative impact on the state's financial position, the federal government can grant financial aid even without legislative powers.
history
The history of influencing the market by means of subsidies goes back a long way into human history. It is known that the early Egyptians subsidized their markets in order to maintain trade in certain products. In Germany the term became common in connection with the coal pfennig and the subsidies of the European Union . The European subsidies are receiving increased public attention , especially in the field of agriculture and the energy transition. The subsidization as a financial means influencing the market is offset by the financial sanction of products ( customs ). After the Second World War, when it became foreseeable that hard coal could no longer be mined in Europe at world market prices, the member states decided to subsidize them in order to make the Netherlands, Belgium, France, Spain and the Federal Republic of Germany independent of the energy supply of other countries. In the context of the dissolution of national borders, European integration and globalization , however, this goal was no longer considered worthwhile for market liberal considerations. The Europe-wide exit from the coal subsidy, which was implemented at different speeds by individual countries, was accompanied by the massive expansion of nuclear energy (compensation of electricity requirements).
species
Funding is not only available in the form of financial grants , but can be made available through low-interest loans , state and federal guarantees , tax breaks or exemptions and public equity capital . Even export credit insurance in the form of Hermes cover is part of the wider concept of financial support.
- Grants can be conditional , unconditionally repayable or non-repayable.
- A repayment is required for low-interest loans . The purpose of the funding is to provide a lower loan rate than the current interest rate .
- Public guarantees serve as collateral for credit institutions so that they can grant credit to the beneficiaries .
In the case of natural persons, the need for assistance plays a role in social law .
Funding sources
Funding sources are the funding institutions and the funds they provide.
Funding institutions
From the municipality to the European Union, there is state aid or financial support for certain investment projects at all levels. All government levels ( federal government , federal states , municipalities ) and government institutions ( KfW , development banks , guarantee banks , agricultural pension banks ) can be considered as funding sources.
Funding programs
Funding programs (also known colloquially as funding pots) are funds from the funding institution's budget that are provided for a specific funding purpose and are limited in amount. The funding offer is usually maintained until the budget has been exhausted.
- The most important funding programs in the EU are:
- ESF is a social fund and the main financial instrument of the EU to support employment measures in the EU member states within the framework of the employment policy of the European Union and to promote economic and social cohesion.
- ERDF is an important structural fund of the EU, which should ensure that the poorer regions catch up economically .
- EAFRD is an agricultural fund that promotes rural development in the European Union .
- At the federal level there are, for example:
- Socially Integrative City is a German urban development program
- Funding through the Renewable Energy Sources Act
- Federal funds to promote education , housing construction or the agricultural structure
- EXIST aims to improve the start-up climate in research institutions .
Funding conditions
The funding institutions issue funding guidelines that include the funding conditions ( conditionality ). These produce the same legal effect as credit conditions and have the applicant therefore satisfies be before it comes to the delivery of assistance. There are personal and factual funding conditions. Personal funding conditions apply to the applicant and / or the beneficiaries of the funding. You have to submit the funding application to your house bank , so you can usually not get in direct contact with the funding institutions. An essential factual criterion of almost all funding conditions is the principle that the purpose to be funded must not have started before the application is submitted. The earmarking is a typical conveyor condition that the funds may be used only for the purpose of funding and this by a reference to prove need.
Funding areas, funding purposes and funding goals
There is an unmanageably large variety of state and supranational funding that makes it difficult even for funding advisors to keep an overview. Depending on the funding area, there are, for example, funding for science and research , business development , education ( BAföG ) or upbringing ( childcare allowance , childcare leave , parental allowance ). Sectors supported include agriculture , the labor market ( creating or maintaining jobs ), social structure , housing , medium-sized businesses or even film funding . Beneficiary groups of people can be parents , children , schoolchildren or the disabled . Funded companies are start-ups or companies in supported economic sectors .
Funding purposes can be state control, subsidies , market influence, economic policy goals such as environmental protection , social housing or home ownership . Financial subsidies mainly serve economic or political goals, but in some cases they have a considerable influence on the entrepreneurial and business level. There are goods and services that are desired due to their political or economic importance, but are only inadequately offered due to market conditions. A higher supply can be achieved through subsidies by providing financial support to either the demand side or the supply side. Accordingly, financial support can be differentiated according to the target group and the type of support. Specific funding goals can be the reduction of research and development costs , the lowering of the acquisition and manufacturing costs for capital goods , the creation or maintenance of jobs or the increase in social standards.
Collision with prohibited aid
Subsidies to companies are initially regarded as aid and fall under the prohibition rules of Art. 107 (1) TFEU , according to which "state aid or aid granted from state resources of any kind that distorts or threatens to distort competition by favoring certain companies or branches of production, are incompatible with the internal market in so far as they affect trade between Member States ”. Art. 107 (3) AUEV, however, lists aid that can be considered compatible with the common market (“regional aid”, “structural funds” or “community initiatives”). Examples are, in particular, regional funding , training funding , restructuring aid , financing of services in the general interest ( services of general interest ), environmental protection aid or rescue aid to cope with the global financial and economic crises . Article 107 (3) TFEU grants a margin of discretion which exempts certain regional, sectoral or horizontal aids from the prohibition. The EU Commission ensures that the member states only grant aid that complies with these rules.
Web links
- BMWi website for researching funding
- Use public funds to finance your company
- Public Funding Database for Business