Haslauer calls for comprehensive reforms to deal with debt!

Haslauer calls for comprehensive reforms to deal with debt!

In a current statement, the Office for the Protection of the Constitution and State Councilor Stefan Haslauer addressed the worrying debt development in Austria. This is happening against the background of increased debt burdens for all local authorities in the country. While Austria's total debt ratio was 81.8% of GDP in 2024, 70.8% was attributable to the federal government, which clearly shows the concentration of the debt burden at the federal level. In contrast, the share of the states and municipalities in this sum was only 13% reports the Kleine Zeitung.

Haslauer expressed concern about the financial situation and pointed out that playing the buck at the expense of the states and municipalities was unacceptable. He called for all countries to review their budgets, especially subsidies and funding, in order to sustainably limit the dynamics of spending. Haslauer also promotes a thorough discussion about the distribution of tasks and financing responsibility between the federal government, states and municipalities. However, he does not conclude these considerations without mentioning possible federalism reforms.

The role of the federal government and debt reduction

The Institute for Federalism has determined that the federal government is the main cause of national debt. Last year there was a deficit of 4.7% of GDP, of which the federal government alone accounted for 3.5%. The states, excluding Vienna, had a minimal deficit of 0.4%, while the municipalities were at 0.2% and Vienna finished with 0.3%. In this context, the institute's director Peter Bußjäger emphasized the need for structural reforms and greater financial responsibility for the states. His proposals include, in particular, an expansion of tax autonomy in order to strengthen the sense of responsibility at the state level and thus promote competitive federalism.

The debt brake, which was added to the Basic Law in 2009, requires states to balance their budgets by 2020 without taking on new debt. In addition, consolidation aid has been set up for financially weak countries to help them balance their budgets. The fiscal pact reinforces the demand for budgetary discipline, but it remains unclear whether the existing regulations are sufficient to distribute the financial burden between the federal and state governments states the bpb.

Institutional reforms in the German context

An important step towards the unbundling of competencies between the federal and state governments is also taking place in Germany. The federalism reform I, which came into force on September 1, 2006, was initiated to overcome lengthy decision-making processes and increasing centralization at the federal level. This reform led to a reduction in the approval rate for federal laws from around 60% to 35-40% reports Wikipedia.

As part of this reform, the states received more legislative authority in various areas, while the federal government remained responsible for specific pressure issues such as nuclear energy, weapons law and the protection of German cultural property. Nevertheless, the new regulation of financial relations between the federal and state governments was only promised and remains a controversial topic to this day. Critics point out that despite the reform, numerous challenges remain and the complexity of the structures has not been resolved.

In summary, it can be said that reforms in the area of ​​financial governance are urgently needed in both Austria and Germany in order to develop long-term solutions to the debt problem and the distribution of tasks.