Chancellor Scholz himself has advocated this: the federal government should help over-indebted municipalities. But this will be extremely difficult for the traffic light coalition.
According to a report, the federal government cannot take over municipal debts without making changes to the Basic Law. Since the financial relief of municipalities is currently the responsibility of the states, the federal government would have to be expressly authorized to take over debts, according to the study by the Bundestag’s scientific service on behalf of the FDP parliamentary group, which was first reported by the “Rheinische Post”. This makes a solution to the debt problem unlikely in this legislative period.
In the 2021 coalition agreement, the SPD, Greens and FDP had actually resolved: “Within the framework of federal-state financial relations, we want to help municipalities solve the problem of old debts.” This is because many cities and municipalities, especially in North Rhine-Westphalia, Saarland and Rhineland-Palatinate, have such high cash loans that important investments in debt, infrastructure, swimming pools, theaters and other things fall by the wayside.
Ministry of Finance: Federal and state governments should help together
According to a proposal by the Ministry of Finance, the federal government and the states should each take on half of the municipalities’ excessive liquidity loans in a joint effort. At the same time, the municipalities should be obliged to avoid new over-indebtedness.
According to the report, however, the Basic Law would have to be changed for both of these things. It is also not clear whether the federal government’s assumption of old debts would fall under the debt brake, it says. In that case, an exception would have to be expressly stipulated here too.
Union is against
However, changes to the Basic Law require a two-thirds majority in the Bundestag and the Bundesrat. The Union and several states have so far rejected a reform – among other things because only indebted municipalities would benefit from it. This is simply unfair and disadvantages states that adequately equip their municipalities themselves or pay off their debts through their own efforts, argues Bavaria, for example.
“The CDU must step in at the state and federal level. Otherwise, nothing will happen,” demanded Frank Schäffler, the Bundestag’s budget officer and vice-chairman of the North Rhine-Westphalia FDP. The SPD also recently called on the Union to give in on the issue.
Source: Stern
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