Municipal leaders are issuing a stark warning to the German federal government and state premiers, urgently demanding immediate financial assistance during the upcoming conference of state leaders. Burkhard Jung, president of the German Association of Cities (Deutscher Städtetag), voiced profound concerns regarding the imminent collapse of municipal finances, a situation he described as unsustainable and potentially damaging to core democratic principles.
Jung stated that municipalities are reaching a breaking point, with financial strains now impacting even wealthier southern states. He cautioned that the combined deficit across German municipalities could exceed €30 billion this year, pushing them into emergency budget procedures. These procedures severely restrict municipal spending, limiting action to legally mandated obligations, potentially jeopardizing vital community services like subsidies for sports clubs.
The call for intervention comes as a federal-state dialogue aims to agree on medium-term reforms, but Jung argues immediate action is critical. He warned that reducing the local government to a mere administrator handling deficits risks eroding trust and undermining the foundation of local self-governance, a cornerstone of German democracy.
Jung highlighted a significant structural imbalance: municipalities contribute roughly a quarter of the nation’s total expenditure but receive only one-seventh of the tax revenue, a disparity he argues has inevitably led to present difficulties. This chronic underfunding manifests in tangible consequences across the country, including the curtailment of bus routes, inadequate maintenance of schools and kindergartens, the closure of dilapidated sports halls and a reduction in road maintenance.
Furthermore, Jung criticized the uneven distribution of funds from the federal government’s €100 billion investment package, asserting that most states have passed on only approximately 60% to the municipalities. With reserve funds depleted, the crisis now threatens the very fabric of local services and self-governance. The situation, Jung emphasized, is not merely fiscal; it is fundamentally democracy-relevant and demands an immediate and substantial response from the federal and state governments.