Declining income, increasing expenses and a minus in the budget – the city of Steyr is not alone in this situation. “Most of the district towns are struggling at the moment,” says Linz SP Mayor Klaus Luger, in his capacity as chairman of the Upper Austrian Association of Cities. From today’s perspective, he could balance in Linz until 2027. “But if we’re about to have a recession, we’ll get into trouble.” In addition to the current price drivers such as the Ukraine war and the aftermath of Corona, Luger sees structural deficits as the main reason why cities and larger municipalities are coming under increasing pressure. “As an association of cities, we have been calling for a new footing for financial equalization.” The cities would have to fulfill more and more tasks, “however, that is not reflected on the revenue side.” Luger criticizes “high transfer payments in the direction of the country”, especially in the state of Upper Austria. In Linz alone, there would be costs of around 140 million euros in 2023. The association of cities is demanding that the entire care be handed over to the state – “in return, the cities could take care of the childcare.” Naturally, the country has no interest in this because expenditure on care would grow dynamically. “But we have to tackle this reorganization of the financial equalization now.”
The President of the Association of Municipalities, Christian Mader, also sees many current challenges for the municipalities. “While most municipalities can still achieve a good result in 2022, more and more municipalities will be on the brink from 2023.” Medium-term planning is difficult because of many imponderables. In addition to the war in Ukraine and inflation, there is also the fact that the personnel situation is difficult or that the funds from the abolished cold progression are missing. “I am in favor of this money reaching the people directly, but then the municipalities need other support. Mader hopes “that the federal and state aid packages will take effect soon”.
Source: Nachrichten
