This is a first in Germany: the new federal government has established a Digital Ministry, headed by former manager Karsten Wildberger. What are its core competencies and tasks? An overview.

I. Everything is new in May

The new federal government has begun its work – and sent a long-overdue signal with the establishment of the Federal Ministry for Digital and State Modernization (BMDS). With the organizational decree of May 6, 2025, digitization and state modernization are being bundled in a single department for the first time. This not only addresses a long-standing reform backlog, but also creates a central authority for the interdepartmental management of digital processes. It is a necessary and correct step toward securing Germany's competitiveness in the long term through clear responsibilities, overcoming institutional fragmentation, and stronger digital coordination.

II. Core competencies and areas of responsibility

The BMDS will take on central interdepartmental tasks in digital administration, infrastructure, and data policy. Its core competencies and areas of responsibility include:

• Digitization of federal administration – developing and implementing the federal government's digital strategy, coordinating the digitization activities of all federal departments, promoting the use of artificial intelligence in administration, improving online services for citizens and businesses, implementing the Online Access Act (OZG),
• Digital economy – creating an innovation-friendly environment for the digital economy, promoting competition and reducing bureaucratic costs for businesses, promoting innovation in the field of digital technologies,
• Digital sovereignty – strengthening the technological independence of Germany and Europe by developing key digital technologies and infrastructures such as the “Deutschland Stack,” international digital policy,
• Digital infrastructures – improving the framework conditions for the expansion of broadband networks and other digital infrastructure,
• Artificial intelligence and regulation – leading implementation of the EU AI Act, designing supervisory structures, coordinating regulatory and technical requirements for AI systems,
• International digital policy – actively shaping international digital policy at EU, G7, and G20 level, international cooperation in the field of digitalization, digital sovereignty,
• Cybersecurity – ensuring the security of federal networks and IT, shaping the legal framework for digitalization,
• Digital participation and skills – Promoting digital participation, strengthening digital skills among the population and in the economy.
• State modernization – Reducing bureaucracy and simplifying administrative processes, developing a modern administrative culture, strengthening the attractiveness of public service through modern working models and a new leadership culture, bundling cross-cutting tasks,

A special feature – and at the same time a powerful lever – is the BMDS's right of approval for significant IT expenditure by the federal administration, which is enshrined in the organizational decree. With the exception of security-critical areas such as defense, internal security, and tax administration, all relevant IT investments must be approved by the BMDS in future. This gives the ministry not only formal responsibilities, but also considerable control over the digital orientation of the federal administration – a clear increase in power that can have a strategic impact.

III. Outlook & recommendations for action

The strategic orientation of the BMDS is a long overdue and correct step toward a more coherent, digital administrative and legal landscape. It is finally being recognized that digitalization is not only a tool for administrative modernization, but also a key growth driver for Germany as a business location and, at the same time, a decisive factor in sustainably reducing bureaucracy. In addition to clear responsibilities, the BMDS will also be given budgetary powers. It is to be hoped that these powers will be backed up by sufficient resources. Companies should closely monitor developments, particularly with regard to the special fund that has been approved, which the government will use to trigger substantial investment in digital infrastructure and administrative modernization. New support programs for key technologies and digital transformation are also conceivable.