A construction site sign can be seen behind
a warning light at the BER Airport in Schoenefeld,
Germany. In connection with the numerous postponed
opening dates and cost increases amounting to billions
of Euros, last month the Brandenburg audit office
delivered a disastrous report to the Finance Ministry.
Among other things, auditors proposed a reevaluation
of the responsibility of the advisory committee
under then state heads Klaus Wowereit and Matthias
precisely, in Berlin, its capital and former Reichshauptstadt—when
it comes to the airport business, everything is far
from being “in ordnung” (order); in fact
to use another German word, things at BER are “chaos”
The large infrastructure
project at Berlin’s Willy Brandt International
Airport has run out of money and despite huge cost overruns
and a seeming endless period of time, it still requires
more time to be completed.
So maybe that is not big
news, but keep reading.
What has now emerged in
the media and by word of mouth to us from trusted sources
is an astoundingly complex system of mismanagement,
graft, corruption, and incompetence, all reportedly
connected to the airport building in Berlin.
It now appears all of
it is connected to both management and the supervisory
board representing the three public shareholders: the
State of Brandenburg, the city of Berlin, and the Federal
Republic of Germany.
Of The Accountant
This news not only came
to light but also is, by means of a recently published
confidential report of the Brandenburg General Accountant’s
office, a matter of public record, which is something
new and quite extraordinary.
The 504-page report, written
in elaborate German bureaucratese, outlines in detail
the shortcomings surrounding the BER airport project
from its very early stages. The report condemns both
senior management and politicians acting on the supervisory
A list of the shortcomings
would fill several books, and in any case most of these
have already been detailed in past issues of FT.
In simple, direct words
the general accountant’s office details how the
supervisory board neglected their legal obligation to
question and supervise the management’s decision
and how some members even made sure that reports and
facts imperative for decision-making were not communicated
to the supervisory board the standard three weeks in
advance, but in fact a mere day before the meeting,
which dealt with the question of whether or not the
second opening date on June 3rd, 2012, could be upheld.
What emerges in the report
is that most members of the BER board lacked any expertise
or even elementary knowledge of the management of large
Further, the report notes
that despite crucial information being made available
(albeit quite late in the game), the board decided to
support the management’s decision to go ahead.
Revelations that some
meetings of the supervisory board took as little as
two minutes (tell me all you know in two minutes) is
a real shocker considering what is (was) at stake and
the general, unified uproar over the inefficiencies’
at play at BER.
Particularly damning are
a number of paragraphs in which the General Accountant’s
office deals with the oversight executed by the State
of Brandenburg’s Ministry for Finance.
The explanations provided
by the Ministry were rebuffed as untrue within the report.
The report explains that
the Airport’s annual reports were neither challenged
nor questioned by the Supervisory Board and the Ministry
for Finance, despite clear evidence of insufficiently
detailed risks and mounting budget overruns that would
have mandated otherwise.
The rather simple fact
that changed EC Directives mandating additional security
measures required a substantial redesign of the Terminal
and that therefore construction activities were carried
out, not based on blueprints approved by the authorities,
but on a “construct-as-you-go” basis necessitated,
in the view of the BER’s management, “a
shifting of legal questions towards the end of the construction
In other words, the airport
was replanned and replanned again, changed and expanded
and any plans for eventual approval were to be drawn
Horst Amman is experienced
in large-scale infrastructure projects and serves as
the technical manager appointed from FRAPORT. He had
halted construction temporarily to get a grip on the
mounting issues and problems, and to collect a detailed
The report suggests that
because Horst’s measure clashed with the schedule
of former CEO Hartmut Mehdorn, he was relegated to a
post managing the airports’ waste and water systems
so as not to upset the political stakeholders by further
halts in the construction process.
Reports Of Progress
The controlling reports—submitted
quarterly and detailing the progress of the construction—were
deemed “implausible,” “inconclusive”
and “gave no clear picture about the current state
of planning and construction,” the general accountant’s
That the supervisory board
conducted only the bare minimum of meetings (four per
year) despite mounting problems, and never questioned
advancing construction while approving annual reports
in gross mismatch with projected figures is seen by
the GA’s office as a clear neglect of duty on
the side of board members.
Been Should Have Been
Had the BER board asked
questions regarding the plausibility of the management’s
report on progress, the contractors involved would have
outlined that they had communicated beforehand that
from their point of view the anticipated finishing date
Another main issue is
raised in the general accountant’s report here
in the innocuous headline:
Lacking Validity of Increased Capital Requirements Because
of Evident Risk Factors Not Having Been Considered.”
Apparently, (according to the report) both management
and board knew that the annual reports and projections
were more wishful thinking than factually based.
Apparently, to sum up,
the only measure the board made was to support the switch
of the airports sole technical expert, Horst Amman,
who had expertise and a proven track record, to the
task of waste disposal.
In 3.2, the GA’s
office simply concludes that “lack of business
acumen and planning competence” were evident of
the airport management’s side.
3.4 concludes stating:
and lapses on the risk management side were evident,”
as the management “neglected to either inform
the board about important factors at all or too late.”
The GA’s office
summarizes that the board members were not qualified
to supervise a large and challenging project such as
BER and that in particular a previously conducted review
of liabilities and accountabilities on the side of management
and board members was “structurally faulty,”
biased by conflicts of interest and that “factual
and structural shortcomings were far too numerous to
exonerate the management and board from the responsibilities
of their offices.”
The public prosecutor
in Cottbus confirmed reports that his office was looking
into the allegations and considering whether to file
criminal charges against some of the former or current
members of the BER management and board.
As we go to press, Senior
Prosecutor Horst Nothbaum denied previous reports within
the German media that the investigations were directed
at former Berlin Mayor and Head of the Supervisory Board
Klaus Wowereit and former Brandenburg MP Matthias Platzeck.