Genuine digital returns through modern administrative structures

Berlin, 02.03.2026
The German administration is under enormous pressure: costs are rising, while at the same time demographic change is leaving more and more positions unfilled and tasks undone. In order to remain functional, the administration is relying on various reform approaches, the effectiveness of which varies, however. A policy paper published today in the “GovImpact” series shows that sustainable effects and a genuine digital return on investment are achieved primarily through the targeted modernization of the administrative structures themselves.

In order to work more efficiently and save costs, public administration must become more digital and modern. The policy paper “For a real digital return: Sustainable efficiency instead of short-term savings logic” from the “GovImpact” series– a project funded by the Mercator Foundation and carried out by NExT e. V. and the DigitalService – critically examines which approaches to modernizing and digitalizing public administration are actually promising and which are more misleading.

Based on workshops and interviews with experts and practitioners, the paper identifies three typical strategies currently being pursued to save costs and generate returns:

• Resource cuts upstream of the value chain
• Technological additions at the end of the value chain
• Improvements within the value chain

The latter includes the modernization of existing systems, the adaptation of responsibilities, standards, and internal processes, as well as the optimization of the user experience. The paper explicitly warns that pure budget cuts or the superficial addition of AI tools tend to increase technical debt in the long term rather than solve problems. Instead, investments in the fundamental modernization of inefficient IT systems and the improvement of processes, as well as user-centered applications, should generate sustainable returns for administration and society.

Implementing this approach requires strategic adjustments: systematic impact measurement, modern incentives in personnel law, and a cross-level cost-benefit analysis in budgetary law.

The policy paper was presented at a dinner attended by members of parliament, federal, state, and local government officials, and other experts. Participants discussed the most important findings, shared experiences, and jointly explored ways to make administration more digital and efficient. It is now available on the websites of DigitalService and NExT e.V.