Protection shield for cities and municipalities not agreed upon with Union

by Thorsten Koch

Bavaria rejects the model of the Federal Ministry of Finance to set up a protection shield comprising billions of Euros for the municipalities, in which the federal government and the states would each be half involved. The Bavarian Finance Minister Albert Füracker (CSU) criticized that such a protective shield had not been previously discussed. “If the federal government wants to help the municipalities, it is welcome to do so,” said Füracker. Bavaria would not participate.

The budget spokesman for the CDU-CSU parliamentary group Eckhardt Rehberg emphasized that finance minister Olaf Scholz (SPD) “could not dispose of the federal budget alone” to enforce an “old concept” for “taking over” debts. In previous attempts, the concept “had no chance of being implemented”, Rehberg said. The Union as a coalition partner of the CDU-CSU was not informed. “That’s not how one should treat each other,” said Rehberg. The federal states themselves are “responsible for their municipalities”, he accentuated.

Scholz wants to give municipalities over 100 billion Euros

Media previously reported that Scholz wanted to help the municipalities with a total of 57 billion Euros. The concept paper of the Federal Ministry of Finance is made up of two components: emergency aid, which is intended to compensate for the loss of trade tax, and secondly, “old debt” aid to meet the issues of indebtedness of 2,000 of the most affected cities and municipalities, which could have been 45 billion Euros in 2018. According to data from the most recent tax estimate, municipalities will lose trade tax revenues of 11.8 billion Euros in 2020.

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