For permanently strong financial power in the municipalities

Action alliance “For the dignity of our cities” is fighting to solve old debts in Berlin

Kaiserslautern, 21.03.2022

40 representatives of the action alliance “For the Dignity of Our Cities” were again guests in the Federal Chancellery, the Ministry of Finance and the Bundestag. Among them Kaiserslautern, represented by the councilor Peter Kiefer and the head of the finance department, Claudia Toense. “The talks were essentially about making it clear how urgently the unfair distribution of funds needs to be remedied,” says Kiefer. The special challenges that require immediate action, such as overcoming the corona pandemic or, most recently, the admission of refugees from Ukraine, are always solved at the municipal level. The cities and counties always paid in advance, even though they suffer greatly from the consequences of unfair financial distribution.

Despite years of municipal savings efforts, the consequences of the Ukraine war will once again have a significant impact on municipal budgets, for example through tax losses. Inflation and rising costs, especially for investments, are being exacerbated by the aftermath of the war and are putting even more strain on local authorities. The action alliance “For the Dignity of Our Cities” therefore presented the representatives of the Federal Government and Bundestag with a position paper with three core demands:

1. Reduction of old debts from liquidity loans and old housing construction debts of East German municipalities

2. Fair compensation of the costs that arise at the municipal level because the federal and state governments oblige the cities and districts to carry out numerous tasks

3. New funding policy for municipal investments, which means that not only wealthy municipalities take advantage of funding, but that financially weak municipalities in particular make progress – for example in the future topics of climate protection, digitization and education

The top representatives of the federal government gave clear signals that the message from the municipalities had gotten through, combined with the demand that solutions also urgently need to be worked out in the respective state governments. The Saarland, Hesse, Mecklenburg-Western Pomerania, Lower Saxony and Brandenburg have already solved part of the old debt problem in their municipalities. Rhineland-Palatinate has announced such a step, in North Rhine-Westphalia there is no solution so far. In this context, the head of the Chancellery, Wolfgang Schmidt, made it clear that the federal government’s old debt solution must be limited to the federal states in which the affected municipalities are located. This assumes that all federal states act in solidarity.

Further information

66 municipalities from eight federal states have come together in the action alliance “For the Dignity of Our Cities”. More than 8.5 million people live in the cities and districts – and thus more than ten percent of all Germans. The municipalities were particularly affected by the structural change, which is why they have low tax revenues and high expenditures, especially in the social sector. As a result, the municipalities are particularly disadvantaged by the financial distribution described and were particularly forced to incur debt in order to be able to fulfill the tasks assigned to them.

Alliance members are: The mayors and mayors, district administrators and chamberlains from Bochum, Bottrop, Brandenburg an der Havel, Cottbus, Cuxhaven, Dinslaken, Dorsten, Dortmund, Duisburg, Ennepe-Ruhr district, Essen, Frankenthal, Frankfurt an der Oder, Geestland, Gelsenkirchen, Gera , Ginsheim-Gustavsburg, Gladbeck, Hagen, Hamm, Hattingen, Herne, Kaiserslautern, Koblenz, Krefeld, Lahnstein, Vorpommern-Greifswald district, Leverkusen, Löhne, Ludwigshafen, Lünen, Mainz, Mayen, Moers, Mönchengladbach, Mörfelden-Walldorf, Mülheim the Ruhr, Neustadt an der Weinstraße, Neuwied, Oberhausen, Obertshausen, Offenbach, Pasewalk, Pirmasens, Recklinghausen, Recklinghausen district, Remscheid, Saarbrücken, Salzgitter, Schwerin, Schwerte, Solingen, Strasburg, Trier, Unna district, Voerde, Völklingen, Waldbröl, Werne, Wesel, district of Wesel, Wismar, Witten, Worms, Wuppertal and Zweibrücken.