Scholz's debt plan: municipalities shortly before collapse!

Scholz's debt plan: municipalities shortly before collapse!

In a dramatic step, Chancellor Olaf Scholz recognized the urgency of a regulation to relieve the municipalities from their old debts. In view of the upcoming new elections on February 23, he announced that he had commissioned Finance Minister Kukies to prepare a proposal for a necessary change of the Basic Law. Scholz emphasizes that time is pushing and this new advance is inevitable to counteract the financial overload of numerous municipalities. In particular from the Saarland CDU, outraged criticism and the accusation that it is "campaign-exacerated", as CDU parliamentary group leader Stephan Toscani announced. According to the Federal Statistical Office, the cities in Saarland are most indebted, with per capita debt of over 6,100 euros, which also tightens the situation.

rising debts and pressing measures

The challenges that the municipalities are facing are huge and affect numerous cities and counties in Germany. In particular, the federal decision to only partially cover the accommodation costs for refugees has dramatically increased the financial burden on municipal households. Estimates of the German district day assume additional loads of around seven billion euros. The district of Mansfeld-Südharz must now even file a constitutional complaint with the Federal Constitutional Court due to its financial situation, which means a deficit of 42 million euros. The district councilors require a clarification as to whether there is a minimum equipment for municipalities in the Basic Law that should enable them to fulfill their tasks.

The dimensions of the financial crisis are alarming. The general manager of the German City Day, Helmut Dedy, described the situation as "dramatic" and reported more than twice as much of a planned overall deficit of at least 13.2 billion euros for municipal households this year. It is becoming increasingly clear that the cities urgently need support in order to gain scope for action again and to be able to make necessary investments in the future. Scholz 'announcement of a draft law on old debt aid is seen as a positive signal in this context, even if the Union's consent is required for a necessary constitutional change.

The misery of the local finances has now also entered the election campaign, since parties like the SPD propose a “future pact” to loosen the debt brake for countries and to generate additional income. In view of the ongoing financial overload of the municipalities and the increasing debt burden, the question remains how long -term solutions can be developed in order to stabilize the municipal budget and to secure necessary social and infrastructural services.

To learn more about the background of the current political debate, visit the reports of Awardblog.de and Tagesschau.de .